article by David Lowery

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funkyfreddy
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article by David Lowery

Post by funkyfreddy »

I found this article by David Lowery to be very well written

http://thetrichordist.wordpress.com/201 ... onsidered/
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Re: article by David Lowery

Post by Guitar Gaz »

I have said this before and I will say it again - in the 70's and 80's many artists made huge amounts of money (as did record companies). No problem with that as we wanted to buy their stuff and it was a mega investment to record an album (studios and their equipment were expensive and pressing vinyl etc.). But it was clearly a model that wasn't going to last with the onset of digital and bedroom studios with cheaper gear. The mistake made by record companies and ultimately artists was that they thought the same charging regime/business model could continue and that minor rock stars should earn more than the national income of some countries. iTunes should charge 25c (or 25p to us Brits) per track and 50c for longer tracks. Albums should be about £3 or $3. They don't cost much to produce, especially downloadable albums (CD's could be scrapped). That is a workable model for the future and would make it easier for people to make a living. But its a bit late now - my kids don't buy or download - when they listen its on Spotify (for which I pay a monthly sub of £5 each) or worse they go to YouTube and listen or watch from there for free. YouTube is probably the biggest danger to recording artists as it is deemed legal as far as I can tell and is free.

You can only stem the tide if the penalties for piracy are enforceable (and file sharing via torrents is still a grey area) but it will not work if you still charge 99c per track. That is a bit of a rip-off and is partly to blame for why we are where we are.
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Re: article by David Lowery

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Guitar Gaz wrote:iTunes should charge 25c (or 25p to us Brits) per track and 50c for longer tracks. Albums should be about £3 or $3.
Really? really??? :shock:
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Re: article by David Lowery

Post by Guitar Gaz »

James Steele wrote:
Guitar Gaz wrote:iTunes should charge 25c (or 25p to us Brits) per track and 50c for longer tracks. Albums should be about £3 or $3.
Really? really??? :shock:
Yes really. The economics are different now from when you needed state of the art studios, record companies, publicity, pressing plants, distributors, and so on. There is little record company investment needed. The business model is not what it was. Artists only got a miniscule proportion of the sale price anyway - now they should be able to get much more without having to pay off massive record company costs of manufacture. The costs are so much lower. And if you sell a million copies that's a lot of money - maybe you won't be able to buy an island, but that is still a good return. The current model clearly doesn't work. A lot of people won't pay $9.99 for a downloaded album clearly.

But people will pay if the price is right and stay legal. Just because the previous model allowed one hit wonders to retire does not mean that should continue. Many people aren't buying - all art is subject to market forces. I also think its too late as the horse has bolted - greed got the record industry here and they need a new model to work on that may not give a musician a life of Reilly but it may just pay them a living.
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Re: article by David Lowery

Post by James Steele »

A lot of people won't pay $9.98 for an album, but does that mean $3 is the price point? Is that going to make them buy it instead of pirate it. How long do you have to go before you overcome the objection that "buying music is inconvenient?"

The thing is few independent artists achieve the kind of sales volume that $3 an ALBUM is going to recoup even their modest expenses plus pay them much of anything for their effort. 25 cents per song? I don't see the price reduction resulting in an significantly increased volume that you could make anything from that.

Yep... it's the T-Shirt business isn't it?
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article by David Lowery

Post by kgdrum »

I don't think the price either way is the determining factor for many people,choosing to buy or not to buy.
Unfortunately IMO many people in the digital age think music should be free & will avoid paying at any price.
Artist compensation and sound quality IMO isn't a determining factor for many of these users, the concept of paying 25 cents or 99 cents per song or $3 - $10 for an album is not a concept many people can fathom.
I have a friend who's a very talented composer,musician who's had 3 major label releases,lots of critical success and makes more $$ than I ever make.
On all levels except software he is a very "moral,intelligent person" but all of his software,samples etc.. are from torrents.Somehow he always finds a way to rationalize not paying for software,I think even if software were sold at crazy low prices,with his mindset he'd still find ways not to pay.

I don't think it's the price as much as the concept of why pay? & entitlement people feel presently.
Very sad.......
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Re: article by David Lowery

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kgdrum wrote:I think even if software were sold at crazy low prices,with his mindset he'd still find ways not to pay.
Free always beats out any other price. And if the free version is just as easily obtained as the 25 cent version, people will download the free version.

One of the reasons why I posted an article a while back that I thought was very interesting and it had to do with the concept of "iPad albums." A experience that included audio, video, interactivity, etc could be sold through the App Store. Seems like there has to be a value-added incentive with music.

Believe me, these are very confusing times. I was having a conversation with a friend of mine about this and one thing I overlooked is because I write my own songs, I assume a musician is also a songwriter. From what I hear, songwriters can get compensated pretty well and some bands have headed off the problems by agreeing to split songwriter royalties with band members who might not "technically" qualify. If you're just a hired gun and not writing any of the songs, I could see how it might be much more difficult.
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Re: article by David Lowery

Post by funkyfreddy »

James, I actually believe it's songwriter's (songwriters that just write song as opposed to songwriters that are performers as well.... unless of course they have a hit) that have been hit hardest by the "new music paradigm", LOL.... nice term for piracy, isn't it?

What really gets me is these myths/concepts such as the "Long Tail" and books such as "Hack Your Hit". These things are written by tech people who do music as a hobby, not by pro musicians. Then when a real pro like David Lowery speaks his mind he gets trashed all over the web.

All pro musicians should read the comments posted in newsletters such as Bob Lefsetz's and read the artist bashing that goes on in them. It amazes me just how much music and musicians have been devalued in our culture. :cry:
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Re: article by David Lowery

Post by Guitar Gaz »

kgdrum wrote:I don't think the price either way is the determining factor for many people,choosing to buy or not to buy.
Its one of the basic laws of economics - so of course price makes a difference. And the fact that the horse has bolted due to short term greed means that the fact that people want it for free proves the point that price makes a difference. Zero is a price too.

Can anyone deny the costs of recording and releasing an album are much cheaper now and record companies and their monstrous admin overheads are not really required ? So the price point does not need to be nearly so much.
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Re: article by David Lowery

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Guitar Gaz wrote:Can anyone deny the costs of recording and releasing an album are much cheaper now and record companies and their monstrous admin overheads are not really required ? So the price point does not need to be nearly so much.
Can't deny it at all. Just saying it seems to me that at the price points you suggest, there would still need to be a SUBSTANTIAL amount of volume to recoup and compensate the PEOPLE for the time spent on it. And how do you generate that kind of volume? Puts you right back at the major labels with promotional staff, budgets, and connections, doesn't it? Can an indy generate sufficient volume short of a YouTube video that goes crazy viral and gets them a million hits.

LOL... People love for your music to be on YouTube. Everyone knows how to download YouTube videos and extract audio. I got a lot of requests for that.
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Re: article by David Lowery

Post by mikehalloran »

A number of companies are playing the "if we make it cheap enough, will you stop stealing it?" game. The answer is always "No!" as long as there is an easy way to steal.

Playing into that is the Great Lie of the Internet: "It should be free!"

No it shouldn't.

Once you hinder the ability to steal, as Apple is doing with the App Store, then the free market can get to work. Logic Studio bundle for $499 or Logic Pro for $199 as an app? If 3x buy the $199 version, then dropping the price was the best thing to do.

This won't be able to be tested completely till v.10 as LStudio 9 is still easy to steal and Software Update will update the stolen copies for free.

Back to the flawed theory that $3 is, somehow the correct price point for an album: That's ridiculous - maybe. Until it is nearly impossible to steal the music, there is no way to test that. None. Will Apple drop the price to 1/3 hoping for 3x the sales to make the same gross but less profit? Absolutely not - if it doesn't bring in 4x or more gross + increased profit, then it was a really, really bad idea.

If the music becomes impossible to steal, then the distributors can play with the price until they find the fulcrum where higher prices = decreased profits. That is how any free market works. One might try lowering prices to capture increased market share but, if unsuccessful, they go back up again.

The biggest flaw in the original article and this theory: That the cost of recording has anything to do with any of it. Were that true, the cocaine allowances for certain bands would not have been allowed in the '70s - '90s.

No one cares what it costs for us to create the music. No one. With very few exceptions, we are now expected to bear 100% of the costs of creating the product. It is estimated that less than 1,000 people in the world have a traditional recording contract anymore.

Major film production is becoming the lone hold out in that - yet how many members of MOTU Nation do film for a living where the studio picks up the cost of realizing the music as a separate item? If you are John Williams or Hans Zimmer, yes... Otherwise, no, most are paid a fee for product - the time and expense being borne by the composer or contractor.

For myself, I get a needle-drop for the finished product when I do infomercials and hope that ASCAP royalties provide my profit.
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article by David Lowery

Post by James Steele »

Good point. When it becomes impossible to steal or so difficult the average person can't, then market economics can work. It's why people can make $1.99 iPhone apps and make good money. The price can't really come down so long as the price is having to compensate for losses due to piracy-- much like the 3rd party DAW plug-ins market.

I do have to say I'm not sure about the new $1.29 price for many iTunes singles now. That small increase killed two impulse purchases for me recently. I sometimes get an old song that pops into my brain and I used to dash right over to iTunes to buy it. The last couple of times I balked when I saw it was a very old song and it was $1.29.
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Re: article by David Lowery

Post by mikehalloran »

Absolutely, James.

If Apple sees an increase in profits, the buck-twenty-nine will stay - or even increase. If profits are flat - maybe - but if they go down, $.99 will be back as the price point.

BTW, the costs for creating those old songs (and screwing the artists) was amortized years, even decades ago. Why do they cost more? Because they are popular and more likely to be purchased. These are the least expensive tunes to make available.

Arguing anything else ignores reality.

I am one of those who firmly believes that any sentence beginning with, "If everybody would just..." need never be completed. "Everybody" never will unless there is a compelling reason that makes it in their best interest.
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Re: article by David Lowery

Post by Guitar Gaz »

mikehalloran wrote:
Back to the flawed theory that $3 is, somehow the correct price point for an album: That's ridiculous - maybe. Until it is nearly impossible to steal the music, there is no way to test that. None. Will Apple drop the price to 1/3 hoping for 3x the sales to make the same gross but less profit? Absolutely not - if it doesn't bring in 4x or more gross + increased profit, then it was a really, really bad idea.

If the music becomes impossible to steal, then the distributors can play with the price until they find the fulcrum where higher prices = decreased profits. That is how any free market works. One might try lowering prices to capture increased market share but, if unsuccessful, they go back up again.

The biggest flaw in the original article and this theory: That the cost of recording has anything to do with any of it. Were that true, the cocaine allowances for certain bands would not have been allowed in the '70s - '90s.
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.

The cost of production of music (and books) has a lot to do with all of it. There is no physical product, no warehouses, no production line, no transport and distribution. These are huge costs which aren't needed anymore. 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.

I am convinced there would be an increase in turnover if prices were lower. Plus it would be a business model with sustainability. Rather than what we have now which makes no sense and has little future. 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.
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Re: article by David Lowery

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mikehalloran wrote:Will Apple drop the price to 1/3 hoping for 3x the sales to make the same gross but less profit? Absolutely not - if it doesn't bring in 4x or more gross + increased profit, then it was a really, really bad idea.
Bang on Mike. Apple understands the "basic laws of economics" better than most. A lot of people think the goal of pricing is to maximize sales volumes. It isn't unless the plan is bankruptcy. It's about maximizing profits.
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