Music Execs Gather At Digital Music Forum East
February 27, 2008 at 5:30 AM (PT)
Five hundred top members of the music business gathered TUESDAY (2/26) in NEW YORK to hear that "music 1.0 is dead," writes NATE ANDERSON in ARSTECHNICA.COM. TED COHEN, a former EMI exec who used the phrase, opened the DIGITAL MUSIC FORUM EAST by pleading with the industry to be wildly creative with new business models but not to "be desperate" during this transitional period. But what is music transitioning to? No one seemed quite sure, except to say that it won't look much like the music business of the last several decades.
Music 1.0 is dead.
Consider the statements that were made today without controversy:
* DRM on purchased music is dead
* A utility pricing model or flat-rate fee for music might be the way to go
* Ad-supported streaming music sites like iMeem are legitimate players
* Indie music accounts for upwards of 30 percent of music sales
* Napster isn't losing $70 million per quarter (and is breaking even)
* The music business is a bastion of creativity and experimentation
MUSIC CHOICE Pres. DAVID DEL BECCARO laid out a clear case for change and for labels to focus more on building long-term partners than on short-term advances and profits, but he sees the music industry's fundamental transformation as taking ten to twenty years to complete. In a business changing this quickly, that could mean death.
THE ORCHARD Pres./CEO GREG SCHOLL pointed out that the music business is not just four companies, and that indie music's market share is now approaching one-third... and it's growing. Indies have also been more open, historically, to experiments such as selling music without DRM. If the major labels take more than a decade to turn the ship around, they risk running a ghost ship with little in its cargo hold but a valuable back catalog. The indies could instead become the place for fresh new music and even for established artists who want more control (we saw that last year with PAUL MCCARTNEY, JOHN FOGERTY and JAMES TAYLOR, for instance).
But no one quite knows how it will all shake out at this point. As SONY BMG's THOMAS HESSE put it, "the next big thing is a dozen things."