How do we make money? 

1 April 2008

So here we are in this new media world. We download our music and give it to our friends, so the musicians who make it don’t get any income. We write our blogs and splatter our opinions all over the Net and nobody pays us – even the most famous bloggers rake in a pittance – while the Los Angeles Times is laying professional journalists off. We edit Wikipedia articles from our limited knowledge and everyone reads them rather than getting the facts from Encyclopedia Britannica, which withers on the vine with all those editors and contributors to pay. How is anyone going to make any money in this new media world?

Well, of course, it isn’t quite like that – at least, it isn’t quite like that yet. But there are some real problems out there and musicians in particular are the ones feeling the brunt of it. Why – because people are sharing their records for free, illegally, like the record companies say? No – we look at that elsewhere and it’s largely bullshit. Research indicates that at least 75% of music people have on their hard drives – and perhaps much more – is stuff they bought.

Increasingly, musicians are going their own way without the benefit (or otherwise) of the record companies that did so well in the past. Those record companies are in meltdown, and if you are an insider and know all the things they did in the past, you will be pleased, as is veteran artist manager Simon Napier-Bell, writing in the Observer Music Monthly recently. Musicians are taking distribution in their own hands, but the business model is still a difficult one to get right, and we (and they) don’t know the answers. We just have to hope there are some.

The big question is indeed, "How do we make any money?" Or at least, how do musicians make enough to live on respectably and focus on their art? There is a fine balance to strike, and it may not be possible: on the one hand giving people music that they can do what they want with – like everything up to and including Compact Discs, still the place where all the catalogue is – and on the other not having it freely shared by Gen Y’ers who don’t know what Intellectual Property as a concept means.

A friend of mine across the water wonders where this is all going. Jerry del Colliano runs one of the most successful and authoritative online consumer audio journals (two of them in fact). He likens the traditional record companies to a redwood forest, and for him, that forest is in flames. Some time after the ashes have cooled, many many new shoots will indeed grow, like the new media pundits say, but they will never match the mightiness of those long-gone redwoods, reaching to the sky.

You can criticise this view. For example, you could say there is no forest of redwoods, just about four enormous trees, and that’s been the case for years. Media consolidation has much more to do with relaxation of business regulation than it does with the Internet. In the old days those big trees overshadowed all the small shoots and killed them off by stealing their nutrients – the budding artists the indies had discovered. OK, this analogy is about to fall apart, so let’s move on.

Last time in an editorial I mentioned what Kirsty Hawkshaw is doing with Magnatune. At the same time, Kirtsy believes that at least part of the future is centred around live performance, or something like it – an event you can’t download and share for free. In other words, the tours finance the records, which promote the artist, which brings people to the gigs… the traditional record business turned on its head.

Kirsty is also big-time into Second Life, the online metaverse (I am there myself because of her). How she will make money there is anyone’s guess at the moment, though it’s great for PR – rather like having a web site. (Plotting terrorist attacks and money laundering in Second Life? you must be f***ing joking! That report is from one of Murdoch’s papers, of course, picked up elsewhere.)

I also, in an aside to a recent MediaBlog article, mentioned Jonathan Coulton, an extraordinarily talented and witty songwriter/performer whom I discovered as a result of tracking down his haunting closing-credits song for the computer game Portal, called Still Alive. He’s originally a software engineer (his wry take on the life of a ‘Code Monkey’ is beautifully captured in the song of the same name), and had some ‘internet hits’ that were sufficiently successful to enable him to leave the software industry and make music his full-time business – see, it can work! You can buy his stuff all over the place – at least in the States: on his site, in several non-DRM’d formats (the best choice); as mp3 downloads on; as downloads on iTunes Plus; on CD from Amazon again and a bunch of other sites… and so on. Go there now and check out his work.

If there is a new media business model for selling music, these two between them are probably closer than anyone to finding it. I just hope they succeed. May a thousand redwoods, er, bloom!

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