Monday, April 14, 2008

Major Labels Face The Future?

As our name implies, Future of Music Coalition is interested in, well, the future of music — one in which artists are fairly compensated for their work.

The major labels haven't always had artist interests at heart. And they've certainly got a poor reputation among some music fans, due to the extreme legal measures taken against alleged file sharers.

But recent developments at the majors indicate a willingness to explore new avenues in music access and distribution. It remains to be seen which, if any, of these "experimental" models will gain traction, or if they will be fair to all artists.

You've probably read about music-tech pioneer (and FMC Advisory Board member) Jim Griffin's recent appointment at Warner Music, where he'll help them think through a possible "music access charge" (likely to take the form of a small surcharge on your internet bill) that would, through the magic of licensing, make file-sharing OK. The idea, which was put forth some years ago at an FMC Policy Summit, has its supporters and critics. The L.A. Times' BitPlayer blog provides a decent overview of the back-and-forth.

Even more recently, Google Chief Information Officer Douglas Merrill moved over to EMI, where he'll head the label's digital music division. According to this CNET article, Merrill is willing to "experiment" with several kinds of models, including but not limited to ad-supported music and even —gasp!— file-sharing:

"For example, there's a set of data that shows that file sharing is actually good for artists. Not bad for artists. So maybe we shouldn't be stopping it all the time. I don't know...I am generally speaking (against suing fans). Obviously, there is piracy that is quite destructive but again I think the data shows that in some cases file sharing might be okay. What we need to do is understand when is it good, when it is not good. . . suing fans doesn't feel like a winning strategy."

He's right that suing fans isn't a winning strategy, but neither is cutting artists out of potential revenue streams. Any new models to monetize music in the digital realm must provide compensation for not just major label acts, but also their indie counterparts.

For example, a recent deal between three of the major labels and MySpace doesn't include the indie artists that helped make the site so popular. Digital distributor The Orchard (which works mostly with indie bands and labels) was quick to criticize the deal. And there's another problem with this "equity" arrangement: the major labels have yet to explain if and how they'll apportion money to the artists themselves.

Maybe the whole idea of depending on a major label is outdated. Wired's Listening Post blog is reporting that slicethepie — which lets fans directly invest in their favorite acts — will fund 30 new bands this year. Apparently, that's more musicians than Sony/BMG, Warner Music Group or EMI signed in 2007.

What do you think?

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