article by David Lowery

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Re: article by David Lowery

Post by James Steele »

Guitar Gaz wrote:Its difficult now the horse has bolted - but the chance was missed a few years ago for short term greed and gain by setting iTunes prices so high. People don't want to pay so much for mp3's with no physical product - a bit like e-books.
That's because some consumers completely miss the point and are ignorant of what goes into creating any piece of work and the labor of the professionals involved in creating it. The cost of the physical product often really isn't that relevant. DVDs are cheaper today, therefore if a blank DVD is $1, why the hell should the last "Transformers" movie cost $29?? I mean it's not fair, right? Or it only costs $1/per unit to manufacturer a CD. I got in this discussion with someone and offered a compromise. I'd sell them a shrink wrapped CD with all artwork, etc. for $1 instead of $10, but I'd just leave it blank.

I mean the value in a novel isn't the paper it's printed on, is it? Maybe when Michelangelo delivered his "David" statue, they could have argued that because he got the marble at a discount that it should be cheaper? Not comparing myself to someone of his talent at all BTW, but saying "Hey Stephen King! Why is your book $19.95?? Don't you know the paper is only worth 50 cents?" is rather ludicrous. There's a whole lot of talent and sweat equity that goes into making that raw material WORTH SOMETHING. The physical cost of the medium isn't the point.

As an aside I think iTunes pricing was quite reasonable, except as I mentioned earlier, I think raising the singles to $1.29 on back catalog stuff isn't a good idea and in two cases it ended up in a lost sale. I didn't pirate the songs. I just decided I didn't like them enough to pay to have them.

There is no justification for publishers and record companies keeping so much of the income, or iTunes for that matter. The artist should get more but that won't happen of course.
Won't happen as long as artists continue to step all over each other to try and sign bad deals. But without getting political, because that's verboten, your choice of the word "justify" disturbs me. We live in a free market system. It's capitalism. If I want to offer a product or service at a certain price point, I don't owe you or anyone else moral justification for it. You have a choice. You purchase that product or you don't. If enough people refuse to purchase it, then the seller rethinks his pricing. But what moral authority do you claim? Because I cannot afford a new Porsche, should I call the local Porsche dealership and demand they JUSTIFY the price of their cars to me? If they make a good product, the marketplace rewards them with demand. If they don't it doesn't. If people were magically able to make duplicate copies of Porsches from their friend's cars, Porsche eventually goes broke, lays off people, quality declines. Etc... etc... etc...

*** EDIT *** Sorry I missed your point. You were talking about the portion the record company and publisher keep, not price. I guess that's partly because the record companies taking the financial risk?
I am convinced there would be an increase in turnover if prices were lower.
Any evidence to support this? As Mike pointed out, as long as there is a FREE alternative out there, it's rather hard for any price to compete with FREE. What would be a good price for a single? 30 cents? Apple takes 10 cents. You get 20 cents per unit. Let's see... if you move 1,000 units you make $200. Good luck with those sorts of numbers.

Plus it would be a business model with sustainability. Rather than what we have now which makes no sense and has little future.
How is it sustainable? The kind of price points you're suggesting has everyone in a band, and all peripheral professionals making below minimum wage and snacking on top ramen on the way to their day jobs. And if there is any correlation between intelligence and creative potential, the product being released will suffer as "intelligent" people decide to hell with this occupation and decide they'd like some sort of standard of living and health insurance, etc.

But that won't happen now. Something will make a change - probably along the Cloud/Spotify route with artists receiving royalties rather than sales income. Coupled with the law being sorted out regarding piracy.
Have you seen the sorts of payout from streaming services right now? It's really, really awful.

Frankly, I think a much better approach for independent artists is to work harder in the area of developing a relationship with their customers... aka "fans"... and cultivate those that are willing to purchase your CDs or downloads at a fair price. I've sold quite a few downloads and I'm not even performing live yet, but I've done it by treating customer/fan interaction as part of the job and building those relationships.

One other matter to consider is that once you start giving your music away, you condition your customers/fans to expect that. Convincing them to pay for something once you've cross the FREE line is hard and there's almost no going back.
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Re: article by David Lowery

Post by mikehalloran »

>but the chance was missed a few years ago for short term greed and gain by setting iTunes prices so high.<

Uhh... Apple has made billions of dollars on this model. You are not going to convince anyone that a chance was somehow missed.

In the 1970s, a single was a buck. Adjust that for inflation, a single costs far less than that now.

Apple has a found a price point that works. None of your huffing, puffing and weird-assed economics is going to change that. You make assumptions that have no basis in reality. The music business is changing, no doubt about that but your version of reality isn't the trend.
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article by David Lowery

Post by James Steele »

mikehalloran wrote:In the 1970s, a single was a buck. Adjust that for inflation, a single costs far less than that now.
I was going to mention this and forgot. Yes, indeed! I bought many 45s as a kid.
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Re: article by David Lowery

Post by Guitar Gaz »

mikehalloran wrote:>but the chance was missed a few years ago for short term greed and gain by setting iTunes prices so high.<

Uhh... Apple has made billions of dollars on this model. You are not going to convince anyone that a chance was somehow missed.

In the 1970s, a single was a buck. Adjust that for inflation, a single costs far less than that now.

Apple has a found a price point that works. None of your huffing, puffing and weird-assed economics is going to change that. You make assumptions that have no basis in reality. The music business is changing, no doubt about that but your version of reality isn't the trend.
If you read more carefully what I actually wrote I was making the point that the sustainable business model based on lower price is no longer feasible. You disagree with my model based I presume on the price? The only empirical evidence I have is that I talk to people. Okay make the price $5 an album - I don't really care as long as its sustainable. CD production will eventually cease and formats will move on from mp3 to better ones. That will cut production costs as there will no longer be a physical product - it must cut costs and is economics (and nothing weird assed about it). Yes Apple made millions but they no longer make as much as they could have done or could be doing - it is a shrinking market whereas higher turnover and lower profit is always more sustainable. That is economics again. The assumptions I make are very much based in reality - everyone is decrying the piracy and free downloading which clearly means the current business model is not sustainable and Apple's price point will not work for the long term.

I really don't think any thing I wrote was huffing and puffing or weird-assed economics. Price affects demand - nothing weird assed about that either. I don't have a version of reality - I live in the real world and am a consumer. There seems to be an assumption that musicians are worth more than the market is prepared to pay. A bit like saying my house cost me £1M and therefore its now worth £1.5M. No it ain't if no-one is prepared to pay that amount whatever it cost. That's economics - if people feel the price is too much and they can get it for free by illegal means which are not being dealt with by the law then clearly this is what seems to be happening.

You don't agree with my business model but what have you got?

Bands like Marillion already have reached out to their fans and the fans pre-fund their releases - and their fans don't feel ripped off as they know most of the money goes to the band rather than some record company exec who knows nothing about music. That is the future. And royalties from streaming like Spotify. If people are any good the fans will pay to see them live and buy the t shirts - even if the recorded music makes less money.

No point in getting angry about the state of the music business and the unfairness of it all and the fact that there may not be a living in it like there used to be for some musicians on the margins. Life is tough for everyone at the moment in the real world. Propose something different and do something about it as others are doing. No artist has a right to a living because they are producing art. Music is its own reward. Find a better way of selling it and remove the record companies and the likes of Apple from the equation as they are the current dinosaurs of the music business.
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Re: article by David Lowery

Post by Guitar Gaz »

James Steele wrote:
I mean the value in a novel isn't the paper it's printed on, is it? Maybe when Michelangelo delivered his "David" statue, they could have argued that because he got the marble at a discount that it should be cheaper? Not comparing myself to someone of his talent at all BTW, but saying "Hey Stephen King! Why is your book $19.95?? Don't you know the paper is only worth 50 cents?" is rather ludicrous. There's a whole lot of talent and sweat equity that goes into making that raw material WORTH SOMETHING. The physical cost of the medium isn't the point.
I don't actually disagree with much of what you say James - and my concern is about the future of economics in this web world - I have kids one of whom wants to be an artist. Although I do think above you are confusing value with cost. The value of the novel is one thing but the production costs of putting it on paper while cheaper than the past is still a major cost. Again if costs are reduced the price can be reduced. But doesn't seem to be for e-books which is a potential problem - people are already downloading books for free in this new market. Michelangelo would still not have sold his David for less than it cost him (having seen the original it is stunning by the way). Anyway, this is an evolving thing - but Marillion's model (and the stand Prince made a few years back) is a future for established bands and if we want them to keep going we won't rip them off. At least younger bands don't need to have record deal to make music like they used to (who could afford studio time in the 60's, 70's and 80's?). There is hope.
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Re: article by David Lowery

Post by mikehalloran »

>The only empirical evidence I have is that I talk to people.<

Interesting you bringing that up. I work in the music industry and actually talk to people many times a day about the cost of music. The context is different but the core issue is not. People tell me the same thing, absolutely: if the product were cheaper, they would be more likely to pay. When the product became cheaper a few years back, it did not increase the chances that they will. No, as long as people think they should be entitled to free music, the price is not really the issue.

Your "empirical evidence" isn't - it is opinion and there is a big difference. Look it up if you disagree.

Apple has a very successful model at a certain price point. It works despite the fact that music is so easily stolen. Amazon, Yahoo, Google and others are adapting this same model or variations on it. This is the only empirical evidence that exists on this subject. Your remarks that it should be lower because it costs less to produce... in a way, it already is. If not low enough for you? Tough. BTW, I am most definitely not defending their model, only trying to explain to you how it works. Like James, I'd like it cheaper, too - who wouldn't?

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Re: article by David Lowery

Post by Guitar Gaz »

mikehalloran wrote:>The only empirical evidence I have is that I talk to people.<

Interesting you bringing that up. I work in the music industry and actually talk to people many times a day about the cost of music. The context is different but the core issue is not. People tell me the same thing, absolutely: if the product were cheaper, they would be more likely to pay. When the product became cheaper a few years back, it did not increase the chances that they will. No, as long as people think they should be entitled to free music, the price is not really the issue.

Your "empirical evidence" isn't - it is opinion and there is a big difference. Look it up if you disagree.

Apple has a very successful model at a certain price point. It works despite the fact that music is so easily stolen. Amazon, Yahoo, Google and others are adapting this same model or variations on it. This is the only empirical evidence that exists on this subject. Your remarks that it should be lower because it costs less to produce... in a way, it already is. If not low enough for you? Tough. BTW, I am most definitely not defending their model, only trying to explain to you how it works. Like James, I'd like it cheaper, too - who wouldn't?

Before you ask, I do not allow what I do nor the name of my employer to be posted publicly. If you want to know, contact me back channel.
Maybe you don't mean to sound patronising but I'm afraid that is how you have come across - I really don't need you to explain the Apple business model and how it works. I think I know that pretty well thank you. I am not particularly interested in who you work for - in the same way you do not know who I work for - and if you did you might be slightly less patronising in "explaining" economics and business models (or maybe you wouldn't). I have worked in the music business as have my family and some of them still do - I don't pretend that gives me any greater knowledge than anyone else. I am speaking as a nobody who is still a consumer and basically a punter who would do things differently. The price issue isn't a problem for me and making it lower isn't a personal preference per se - I was speaking about the business model from a business (but personal) point of view - something I know a fair bit about. Some of it is very basic economics. I don't have an axe to grind but was giving my personal opinion from my point of view (the same thing but wanted to re-emphasise) about what I think may have stopped this business getting to where it is now, and where it may be going in the future with different business models (some of which I know and have some involvement with). You disagree. Sorry I had the presumption to express an opinion that you disagree with. This ain't personal - its about business - a dirty word that all artists have to embrace. Some are using the internet and fanbases to take back some control. I am not sure the music business has adapted well enough to the changes or has served its artists well enough - isn't that a proverbial scratched record (for those who remember them)?
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Re: article by David Lowery

Post by MIDI Life Crisis »

I haven't read the article and only skimmed the thread (I'm a skimmer, sorry) but if it's been covered, forgive me.

It costs a fuckload more than 25¢ to write music. Yeah, maybe recording a song might be cheap to do, but crafting art takes a lot of time and effort, and EXPENSE, and to negate that is really a selfish, simplistic 'tude, dude.

And another thing... being an artist is more expensive now than it was 30 years ago. We still have rent, and bills, and medical, and food to pay for. Those who value their own art will not give it away for free or cheap. It is a commodity, just like your time and effort. Just because it is easy to distribute now doesn't mean it is easy to create or that it is essentially worthless.

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Re: article by David Lowery

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mikehalloran wrote:In the 1970s, a single was a buck. Adjust that for inflation, a single costs far less than that now.
The CBC is running a radio series on recorded music. On today's episode the mentioned that the first Caruso recording, one song, sold for $100 in today's money and it sold very well. Imagine that.
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article by David Lowery

Post by kgdrum »

The fact is, like it or not Apples model is successful, as of last year over 15 billion songs have been sold on iTunes.
They have changed the music business model.

If you have a successful approach in selling music that's changed the entire industry,made more $$ than Apple could have ever imagined why would you want to or feel the need to lower prices?
Yes there will always be a segment of the population who feels something should be cheaper or even free,that's human nature.
We do live in an age of entitlement.
But the fact is the market determines the correct price,companies have sales and lower prices to stimulate stagnant sales numbers.
Lets be real,the music business has never been predicated on what's best for the artist or the sideman it's always been structured to make the companies rich.
If an artist is uniquely talented,smart and has some leverage mixed in with good marketing and a bit of luck than they might make some $$.
This sad reality has not really changed,most musicians never make a great living in the music business as recording artists.
Live music & touring is where most musicians are able to make a living but live performances have gotten less common and less profitable over the years.
The rules of the game have certainly changed but it's always been a business model predicated on the record companies,distributors and publishers making the majority of the profits.
Most musicians grab the last few crumbs and a few figure out a way to leverage more of a fair share but that's extremely rare.
If Apple suddenly stops selling music on iTunes because the public decides the prices are too high Apple will lower the prices but until that time no smart company will ever feel the need to sabotage their own successful profit generating model that's making more money beyond their wildest dreams.
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Re: article by David Lowery

Post by MIDI Life Crisis »

Apple may have changed the business model for pop artists and others, but they have had zero effect on my life as a composer and performer. I still get paid for my broadcast works, and to perform, compose, and design sound just like I always did. Actually, a little better.

I don't "sell" my work, I license it and that makes all the difference. You can't buy my music for 99¢ on iTunes. You never will while I'm alive or my estate is in control of my work after I'm gone.

But yeah, if you're out to sell "records" like the millions of folks before you did in the model of the recording industry, you're pretty much toast in terms of sales being decent per distribution. You gotta be a little smarter than that to make a living at it.

BTW, if you value Little Johnny Notalent the same way you value Oscar Peterson, that's really a shame. They are not equal, IMO, and don't deserve equal footing in the marketplace.

It is up to the artists to make the industry and marketplace value their work. I can be done, but not by defeatists. That is what copyrights are all about. Control of distribution.
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article by David Lowery

Post by kgdrum »

Very true MLC you are one of the few who have figured out a way to create your own niche but you are the exception to the rule.
You figured out an approach that's worked for you,most don't.
Whether it's brains,talent,luck,being in the right place at the right time etc..... There are so many factors it's not just about having a non-defeatist attitude.
Very few talented musicians ever make a good living in the music business,long term.
For every 1 success story there are probably 100 equally talented musicians that will not have the same kind of results.
Even if your music doesn't lend itself to the iTunes model,iTunes rules the record industry.
I'm not talking just about pop or rock,almost any genre.
Of course Soundtracks and Classical music are somewhat insulated from this but the iTunes market is the general norm now.
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Re: article by David Lowery

Post by Phil O »

Have you been to the grocery store lately? The costs of goods and services have skyrocketed. Had the business model not changed - if, for example, we were still recording on vinyl and home studios were still impractical, we'd probably be paying about $30 (or more) for an LP. Yes, the cost of production has gone down, but prices in general have also gone up - significantly.

Also, with everybody and his cousin in the game now, large sales are comparatively rare. Artists need to make more per piece just to break even. Combine that with lowered sales due to pirating, and one would expect prices to go up, not down. Anyone who thinks record sales are low because prices are too high, just hasn't been paying attention.

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Re: article by David Lowery

Post by mikehalloran »

>Maybe you don't mean to sound patronising but I'm afraid that is how you have come across<

Not my problem.

>I really don't need you to explain the Apple business model and how it works.<

I totally disagree. You have interesting opinions but they are based on wishful thinking and stats GFA (grabbed from air). Since there really is an empirical example, and it really is the Apple business model, I felt the need to point it out and explain reality to you - as I do 10 to 15 other people a day. Apple has nothing to do with my job but explaining realities and costs of music is what I do for a living.
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