Music/Movies and The Big Company Disease

[Kedirekin]

I saw this in an Internet Week article about Microsoft and what the author calls Big Company disease. As I was reading it, I found myself thinking about the music industry, and to a smaller extent the movie industry.

Greed or "what's in it for me?" is built in to capitalism and can clearly become problematic if it gets out of hand. The more powerful the company the more likely this will get out of hand. At IBM I saw this a lot because we dominated so many markets. It is where I first heard software referred to as "air" and that our pricing model was like selling that "air" (in other words the customer had no choice but to pay what you charged, or you would cut off their air). When I'm looking for this as a problem I listen for the words "leaving money on the table" because that is generally directly related to a set of decisions which will alienate customers and create long-term strategic problems for a company.
Competition generally helps you maintain the balance between price and value; once you are successful a substantial effort needs to go in to ensuring that balance remains intact otherwise you will eventually be displaced, if not by another product, by a completely different technology.

What do you think. Do music labels consider Britney to be "air"? Are they working to increase customer satisfaction or just to protect their profits? (Okay, that's a loaded question, but I'm allowed to be biased).

For those that want to see the full article, the link (for as long as it lasts) is: Microsoft Has A Bad Case Of The Big Company Disease (http://www.internetweek.com/e-business/showArticle.jhtml?articleID=17000165)

[DDogg]

The second quote is particularly on target from my perspective and started some thoughts rambling around in my head, albeit nothing original.

Recently, because of a free 14 day trial, I broke down and looked at the Rhapsody music service which offers unlimited listening to what nearly seems nearly unlimited albums for 9.95 a month in a very high quality streaming format (If you want to burn an album each song costs .79 cents usd). It seems to me that a next generation of something like this, especially if it worked directly with the musicians instead of the publishers, would change the paradigm as the quote suggested. The music service would then in fact become the publisher, except at a fee much more fair to the artists.

At that stage it nearly becomes more convenient from a time standpoint to use a service like this, especially if your house is wired for streaming. People then make an investment of time in creating their own personal play-lists to listen anytime to about anything for a flat fee of 10 bucks a month. Time is money and all that, so it may well be that people would rather pay 10 bucks a month rather than hassle with downloading mp3s. It effect is balances the ease of music theft against the *time* needed to do it. Peoples laziness will normally win out over budget if the cost is low enough. The fact that you can then burn a mixed CD of favorites very simply from your own personal lists at around the cost of an single album from the store also capitalizes on laziness and time constraints.

As these type of music services become more advanced they may indeed shift the paradigm to something entirely new that works for the artists *and* the users. Publishers may then serve a much smaller part of the equation, and in fact many may well disappear the way capital good distributors have. I expect this is what publishers are terrified about. They will no longer be able to continue to control the music industry with an iron fist they way they have always done.

[DevilsChild]

I still can't imagine why anyone would pay so much to burn music CD's. If burning to CD costs as much as an album from the store, why bother going through the trouble to burn an inferior copy downloaded off the internet?

A monthly fee of $10 makes a lot of sense. That way, people who normally only buy a few or no CD's per year would be buying the equivalent of 5-10 CD's annually. But charging users to burn each song to CD destroys the incentive to use such a service.

I think the motion picture industry could have even greater success with online distribution. They could sell movies online for a few dollars per title instead of pushing the bloated DVD format for years to come. They could even develop their own container format to support all the features of a DVD (interactive menus, etc) and use whatever copy protection scheme they want. I would much rather purchase a professionally made XviD/DivX movie for a few dollars than pay $20 or more for a DVD or spend a week downloading some crappy file off Kazaa.

With standalone MPEG-4 players becoming a reality, I could see even greater potential demand for such a service.

[dwflo]

DDog & DevilsChild have posted very good points. Greed is the number one factor in all of this.

There is another subject that is not made public enough, and that is runaway production, to other countries.
Too many of our Craftsmen and Technicians are unable to work in their profession, because there is no work. In the process of attempting to squeeze every last dollar out of the consumer, they are also creating longer unemployment lines.

I hope that by pointing this out here, will add to the arguments to "Big Company Disease"

Dave

Here is a copy of an e-mail I recieved today:

To Whomever It Concerns,

"Cold Mountain", the Civil War movie which KCRW has been
heavily promoting of late, is the latest in a too-long line
of "runaway productions" (movies,TV series and commercials shot
outside their country of origin -- specifically, the U.S.). The
financiers and other above-the-line interests who are responsible for
"Cold Mountain" chose to make this could-not-be-more-
American-themed movie in ROMANIA, merely because
they were too selfish and short-sighted to re-consider the
hypocritical greed they were expressing, undermining
their artistic expression. By shooting in a very low-wage country,
exploiting the local workforce, they displaced the myriad U.S.
film craftspersons who could have and should have worked
on this project. As a film industry worker, I
will be amongst those boycotting this movie.

Far too many U.S.-located and -generated productions have
left the U.S., bribed away by various governments' "incentives"
(tax breaks, low wages, lax worker and environmental laws, etc.).
Hollywood is far too rich to justify such taxpayer-
supported subsidies, from any nation.
Canada has been the main culprit in this scam ("Elf", "Honey",
"Chicago", "Paycheck", the "Scooby Doo" sequel, both "X-Men"
movies, "Titanic", "The Score", "Undercover Brother",
"Along Came a Spider", "Shanghai Noon", "Texas Rangers",
"Mission to Mars", "Josie & the Pussycats", "Snake Eyes",
"Reindeer Games", "Get Carter", "Driven", "Affliction",
"Antitrust", "Waking the Dead", "Mother Night", "Dick",
"Detroit Rock City", "Lake Placid", "Snow Falling On
Cedars", "Final Destination", most TV movies and many
TV series were partly or completely shot there). Meanwhile,
Australia, New Zealand, the Czech Republic, Romania and
others are catching up.

If you wish to have my support, and that of my friends, family,
and colleagues in the film/TV industry, you will stop promoting
"Cold Mountain" and instead expose it for the sham it really is.

Get Warren Olney on it!

Sincerely,

John Hays

End of Message

[StrawMan]

Free markets are BAD!

Socialism NOW!

C'mon, grow up.

[Neo Neko]

@dwflo

But didn't the MPAA and that handsome addonas of a man Mr. Jack Valenti tell us that it was P2P that was putting american workers out of business??

Me thinks something stinks!