Dethcack.

In light of all this SOPA and Protect IP stuff…

styrofoam-boots:

I think some people need to understand how buying an album works.

If I go out to buy a CD (say, the upcoming Bruce Springsteen album), and the CD costs $20. Usually around 10% of this ($2) will go to the Bruce Springsteen (Plus possibly more money, depending on the contract). Now, major labels (keeping in mind they have a large distribution network and promotion network) will invest the money they make into acts signed to their label (Not necessarily Bruce Springsteen) plus running costs and other stuff. It kinda gets messy because every band has different contracts, but in the ultra simplified case this is essentially what would happen…

Now I have no problem with this system, it’s a legitimate business and while it centres around the label making money, that’s the way it should be, IF the label has a larger distribution network than a band or even small label would have access to. On top of this, major labels have large networks of people and studios, so that a band has a good chance of getting the producer they love and being able to pay for it using “loans” made by the label. (A piece on this subject is here: http://www.negativland.com/albini.html)

The obvious issue now with this system is that the internet is a much larger distribution network than major labels could ever have, not only because it’s essentially a worldwide service at very little cost, but because manufacturing costs are very minimal (say, $25,000 for a server that allows for large amounts of downloading). In addition, bands now can make quite good quality music with home studio setups and even laptops (for very little cost)…

As an example of how the internet can make money for bands/artists, I’ll talk about Bandcamp. Now, although it’s relatively new, it allows for bands to put their album on the net (lossless quality) for a percentage of the money they make from the service. So, if I pay $20 for that Springsteen album again on Bandcamp. Springsteen will get around $17.5-$18 per album. I’m not saying it’s perfect at the moment, but IF (and it’s a big if) bandcamp got to the equivalent size of major labels distribution networks (i.e. everyone knew about bandcamp) and professional recording technology got super cheap, then it essentially wipes out the power that the big 4 major labels have.

Of course people want to buy CD’s and records, and that’s why independent labels are doing well at the moment.

I could insert stats here saying that the drop in CD sales are not influenced in a bad way by online piracy and that the main reason the ‘90’s were so profitable for record labels was because people were replacing their vinyl collections with CD’s and the drop in record sales are because people aren’t replacing their vinyl collections anymore, but I think that misses the point. What I see as the problem for major labels, is the fact that they’re trying to hold onto a business structure that is becoming less and less relevant.

Back to SOPA, if I lived in the US, the censoring wouldn’t concern me as much as an industry (internet) that’s in it’s infancy growing very quickly and contributes 3.8% to the US’s GDP, being bullied and most likely harmed by industries (“core” copyright based industries) that contribute 6% to the US’s GDP.

Economically it’s a very bad idea.

Links to sources and other stuff here, I’m probably very wrong with a lot of these figures, most are probably only good as estimates:

http://nikhilkunwar.blogspot.com/2011/06/internet-industry-contributes-32-to-gdp.html
http://www.wipo.int/ip-development/en/creative_industry/pdf/ecostudy-usa.pdf
http://www.negativland.com/albini.html
http://www.youtube.com/watch?v=tzqMoOk9NWc&feature=g-hist&context=G2deb6acAHTxiz6AAFAA
http://bandcamp.com/pricing
https://buy.louisck.net/news