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Neil Young is right — piracy is the new radio
- teyc 15y agoIt is so true. Just as a busker would play music for anyone, and gets an appreciative tip once in a while, pre-recorded music can be seen as a leveraged way of busking. In some way, the record industry is doing piracy a service by increasing the perceived value of music. Too bad they don't get a cut for doing that.
- scribu 15y agoA very apt analogy indeed. +1 for Neil Young.
- res0nat0r 15y agoCan you really equate piracy to radio when you can listen to what you want on-demand? This is a big difference from radio and services like Pandora which don't allow you to listen to exactly what you want when you want.
- ChuckMcM 15y agoSo the challenge is 'listen to what you want' versus 'discover new music'. People will listen to something for 'free' even if they aren't sure they will like it, but they won't pay any money for something that they don't know whether or not they will like it. Radio was a way to introduce new music, but with an iPod/iPhone/mp3 player people can carry around days of music that they already know they like, and it has no annoying adverts in it, so they don't listen to the radio any more. Thus a source of discovery is cut off from them. 'Pirates', listening to music and then giving a copy to a friend who they think might like it, allows new music to be discovered. That seeding is required for artists to develop a following. Pandora does similar seeding, but like radio injects advertisements which are annoying to many.
- mohene1 15y agoThe issue of compensation for the artist never seems to come up in these conversations. Neil Young can charge $75 for his cheapest concert tickets. So record sales mean very little to him. For younger artists this is not the case. > but they won't pay any money for something that they don't know whether or not they will like it. people bought albums for decades without knowing what songs were on the album. I don't see how it's fair to justify the acquisition of someones property with the pretense that it's gonna be better for you. Even under extreme cases like nationalisation and imminent domain, the owners are compensated. I made this comment on the Neil Young link, but it was censored. If we are so certain that the artist will benefit under the 'new' system, fine, but if he or she doesn't they have to be compensated to bridge the earnings gap. Comparing music now to music in the 1930's is not fair, artists got paid almost nothing in the 1930-1950's. The whole industry was corrupt.
- deleted 15y ago[deleted]
- ChuckMcM 15y agoYou know that old aphorism "If a tree falls in the woods and nobody hears it, did it make a sound?" For "younger artists" that is code for 'nobody knows who they are.' And that is a very important concept to internalize if you want to understand the economics of information. Lets say you offer to sell someone an 800 page hardcover book about a wizard for $35 [1]. If they have never heard of the author they are going to politely decline. Why? because they can spend $35 on a book from an author they know they like and for whom perhaps their latest book was also read by their friends who liked it. As an economic actor in this transaction they act in their own self interest, to spend their earned income on entertainment for which they have some prediction of enjoying it. Give them a $35 coupon good for any book at Amazon and they might buy it on a whim, make them work half a day to earn that much and they won't. So your observation about Neil Diamond is absolutely correct, there are a lot of people who have heard his music, like it, and will buy it. More importantly because there are a lot of people who have heard it and like it, the probability that a person knows someone directly who has bought it and likes it is higher. The the perceived risk of the purchase is lower. So now imagine that you've got got an artist producing a product. Initially, there is this huge barrier to them selling their product because there are many known artists out there (and the new artist is initially unknown), and there are many 'purchase experience' consumers who are reinforcing the quality analysis of the known artists. So our new artist has no way to communicate their value to their potential customers. So to overcome that lack of exposure, a new artist has to 'be heard' (if we're talking about music) and they do things like play bars, clubs, go to 'amateur night', and try to get a local group of people that like to hear what they play. If they are successful at that they might be able to 'open' for a famous act at their concerts, be the band that 'warms up' the crowd. Now they get to expose themselves to the people who like the main act (and presumably their musical style is similar so they feel they might be liked too) and if enough folks do like them then maybe they can be their own 'headliners'. Of course when you open for Neil Diamond and people are paying $75 to see Neil, not a whole lot of that is going to you, the warm up band. This whole 'getting the word out' is a process that was filled by radio for years and years. It was so successful in fact that music labels would actually pay the radio stations to play their signed acts music. It was a huge scandal. But instead of thinking the money they paid the radio stations as 'lost profits' they considered it a marketing expense. And they were right. They knew, and pretty much anyone who has tried to market an 'art' product (which is to say a creative work), that people don't buy things they don't know about. So you can ask what a new artist's work is 'worth' compared to an established artist. And to understand that you have to include the cost of making the set of customers who would buy this new artists work aware of the existence. That is a huge sunk cost, and one that used to be born by a book publisher or a record label. Once the artist is over that hump of course things are much easier. What Neil has recognized is that 'piracy' as defined by the record labels and book publishers is creating more artist awareness these days than the older channels. That is a really really important change, and it is one that artists, especially new artists, have to internalize. Perhaps in the 'old' days your publisher would pay you $4K for a book, and if that book took off they would make a huge 'profit' on it and you would not see another dime. But on your second book with them you could negotiate better terms. There are many examples of 'hollywood accounting' or 'record label accounting' which show how they do this. The artist doesn't get any benefit early on, and only after being established to they have any leverage in those business negotiations. The 'new' way may be that the early works of the artist get 'pirated' like crazy and spread far and wide. People get exposed to them for 'free' and while the artist gets no monetary remuneration, they are offsetting that barrier of not being a known entity. As they develop exposure they will get more and more pricing control over their work, up to and including the point where people will pay millions in advance to be the first to get their next novel/song/movie what have you. But the key to understanding this is understanding that 'value' is composed of two parts 'awareness' and 'quality.' And they are multiplicative. So if either is zero, value goes to zero. The thing that makes it still work is that the marginal reproduction cost in a digital ecosystem is also nearly zero. [1] http://www.amazon.com/Harry-Potter-Deathly-Hallows-Book/dp/0545010225 http://www.amazon.com/Harry-Potter-Deathly-Hallows-Book/dp/0...
- randomdata 15y agoThe difference is that with piracy, there is a chance you'll stumble upon something new. With the radio, you're stuck with the same handful of songs over and over and over again. But seriously, I have always wondered how the radio model is supposed to work. Whenever I hear a song I like, just wait an hour, and I'll hear it again. There is simply no reason to buy the CD (or record, or digital download). Value is, in part, driven by scarcity. When you only have 40 songs in your rotation, there is no longer that scarcity required to drive the high value. It's no wonder people were no longer willing to pay $20 for a CD.
- zipdog 15y agoThe radio model was not geared to you (as far as I can tell). Up to the 90s, lots of people who heard a song a dozen times on the radio would then go and by the single or album. Even at $8 and $20. I don't know why they did, but they did. I suspect the big problem with piracy (from RIAA perspective) is that it is teaching those people that its just as easy to get it online. Except that iTunes went and made it even easier to get it for $1, so most people in that market I know just buy it on iTunes.
- InclinedPlane 15y agoAre they really so different? The radio plays songs interspersed with commercials that thousands of people hear and a handful of those folks are influenced to go buy cars or soap or deodorant or fast food from the advertisements they heard (thus effectively paying the advertisers, thus compensating them for the advertisements, thus providing the radio station with revenue to pay the license fees which get paid to music studios and eventually to musicians). Is that really so very much better or more ethical than millions of individuals listening to music through file sharing and a handful of those folks being influenced to buy albums, go to concerts, purchase t-shirts and other merchandise which directly benefits the artists? Edit: to add an additional punch to this: how is it that advertisements can be so enormously compelling that they can sustain 4 levels of profit margin (for the company selling the products, for the ad agency, for the radio station, for the music studios) yet the music itself is not sufficiently compelling to support even one level? The answer is that it is. The licensing fees are a token, the ads support the operations of the radio station, the music supports itself. Take away the technological need for a radio station and...
- prawn 15y agoHell, if the music industry ran Pirate Bay themselves and profited from having higher quality ads on there, you would have something a little closer to the radio experience (ignoring ability to choose what you wanted). People would be seeing/hearing ads as they explored new music, as well as buying limited edition products, physical releases, concert tickets, t-shirts and other merch. Problem is, the big players are hanging on to the cliff edge by their fingernails, rather than locking into the harness at the bottom ready to start their climb.
- baddox 15y agoSo radio is only acceptable because it's bad for the consumer? Does making radio better (by allowing on-demand listening) suddenly make it illegal/immoral/bad?
- jeffool 15y agoRadio pays far more per song than Internet streamers do. Running a radio station is $x/song, on the web it's $x/song/listener. (Radio stations cost lots to set up up front, web radio costs kick in when you get bigger, but until then you'd have to operate at a loss, or go ad heavy.
- baddox 15y agoThat's a completely different (and more valid) argument than "pirating lets you listen on demand but radio doesn't."
- deleted 15y ago[deleted]
- InclinedPlane 15y agoWe have come to accept a vast panoply of behaviors of sharing creative works and of allowing people to "consume" music, art, movies, etc. without directly compensating the creators. Radio, television, libraries, used books, etc. We accept such things largely because we've grown used to them. We have lived long enough in an era of libraries and radio to understand that they do not destroy the ability of artists to make a living. Uncompensated sharing in the digital age has been unmoored from some of the traditional limits on sharing, moving it well outside the comfort zone for a lot of people and causing a lot of backlash against the phenomenon. But even though the returns on uncompensated sharing in the digital age are sometimes more diffuse and indirect than for the more traditional forms of sharing we are used to they still exist. Art will survive. Artists will not end up in the poor house. And eventually people will grow as used to what gets labelled "piracy" today as they have to libraries, museums, and radio.
- vibrunazo 15y agoI agree, this goes in line with what Francis Ford Coppola recently said [1]. People refuse to accept it because they cannot understand how it could be different. Hollywood's model is broken because it has been dependent on scarcity of distribution. This couldn't be sustainable forever. Internet fixed the distribution so Hollywood is bleeding. Art is getting easier to access and to create thanks to technology. (this is where we, startups, come in) IMHO, art will become a commodity. In a few decades, you won't pay so much to watch a movie that cost a few millions to produce. You'll pay almost nothing for a movie that cost almost nothing to produce. And it will have much higher quality than today's movies. Thanks to technology. Like you said, art will survive. [1] http://the99percent.com/articles/6973/Francis-Ford-Coppola-On-Risk-Money-Craft-Collaboration http://the99percent.com/articles/6973/Francis-Ford-Coppola-O...
- sausagefeet 15y agoWeren't 2009 and 2010 Hollywood's most profitable years?
- nekojima 15y ago
- Apocryphon 15y agoInterestingly enough, he defends record companies as well here. He's in a very compromise position: http://blogs.wsj.com/speakeasy/2012/01/31/neil-young-defends-both-record-companies-and-piracy/ http://blogs.wsj.com/speakeasy/2012/01/31/neil-young-defends...
- ethank 15y agoTo be fair: Neil always had a great relationship with his record company since being with Reprise. He'd come in and hand deliver every record, staying for playback in our artists lounge. A great guy, super fun and always a joy to hang out with. A true music fan and appreciative of those that worked on his records. His manager Eliot is a great guy too.
- marshray 15y ago"Information wants to be friction-free." That's worth thinking about.
- mekazu 15y agoIs radio dead in the USA? In Australia I think the radio culture is quite vibrant. Personally I download music from time to time that sits on my phone but I listen to the radio 99% of the time because it introduces and plays the best music anyway. The radio stations that I listen to are govt funded[1] so they don't have any ads and have a community focus of getting people to go see live concerts and listen to good music. We also have commercial radio stations that play disposable child-like pop music (combined with horrible ads and drone-like presenters) that is well suited to 13 year old girls but still becomes popular with the masses. So there is something for everyone. I don't support SOPA (not that it counts in Australia, or anywhere else for that matter) but I think that artists should get some money from somewhere for their efforts. People listen to the radio free but they still have the option of buying the album. Downloading the album free makes that option redundant. In Australia people typically pay $40 - $70 a month for their internet which - if they use the allocated capacity - they are using to pirate music, movies and TV without ads. I'd prefer to see part of that money going to an artist fund rather than the ISPs and broadband resellers. [1] triplej.net.au and www.abc.net.au/classic/
- rdouble 15y agoIt's not dead if you listen to country music, mexican music, christian music or talk radio.
- davidw 15y agoNot just country music. They play both kinds, country and western.
- pm 15y agoDon't forget, with digital radio, we now have JJJ Unearthed as a radio station. For the unenlightened, that's the best of Australia's unsigned bands getting played on the radio.
- TylerE 15y agoYes, it's dead. But basically minus the government stuff. Well, there is NPR (National Public Radio) which is about 15-25% government funded, but that's typically news/talk/classical. Some of the edgier NPR stations might have an acoustic rock/folk set at midnight on a Friday...
- jpdoctor 15y agoHe should write a song about it. Here are some suggested lyrics: Hey hey, my my, Piracy will never die, There's more to the torrent Than meets the eye, Hey hey, my my.
- Craiggybear 15y agoIts an interesting viewpoint, and one that is probably very true. People often hear pirated material and like it so much they immediately purchase it. Not only that one album, but even sometimes substantial amounts of the artist's back catalogue. Which was and still is kind of the point with music radio. Same with movies. I wonder how much cash piracy actually generates as substantial income -- quite a bit I believe. And probably more than it denies. Quite a lot of people are exposed to material they would never have encountered, like it and pay up for it.