The Future of the Music Business

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This is Celia Hirschman for On the Beat, on KCRW.

It's December and in assessing the issues that faced the music business this year, I keep thinking about digital downloading and how our world might be dramatically changing with this new technology, moving forward.

It's quite simple to download a song on the Internet. Legally downloads usually require a credit card and a few clicks of the mouse. Within seconds, the songs come directly onto your computer. High speed phone lines enable you to make very reasonable copies and you can imagine what a few more years of technological advances will do.

So I decided to let my imagination run forward a bit, to see what the future record business might look like. It's easy to see that at some point in time, your entire record collection might live on something like a giant MP3 player, or a portable hard drive.

This hard drive would have tons of memory and, in my fantasy, it would synch up to your computer, your stereo, your home theater and your car system. Between your home and work experience, and your commuting time, you'd be able to program your favorite songs at every moment if you wanted.

And maybe instead of renting movies on a Friday night, you'll go to your local downloading future name for video rental and record stores. Instead of renting a movie, you'd buy digital copies of them, which the clerks directly download into your portable hard drive at super fast speeds. The downloading station of the future would also carry music titles.

In fact, in my fantasy future, it's quite possible for bands to make a record and never produce or manufacture a CD for sale. Once their record is produced, mixed and mastered, the label would upload the new music for all online, broadcast, cable and satellite radio stations. They'd also upload the new music to key journalists, television and night club booking agents. And the label would make the music available to these new downloading centers.

With the push of one button, the taste-maker trade would get to hear the new sound first. If they like it, the gate-keepers would open their doors to the public. Once the record was on the radio and in downloading centers, the revenue stream would be completely e commerce driven. All this without a single disc ever being manufactured.

So how realistic is this? It's all actually possible now. The technology already exists for all of this and you can find a lot of it happening abroad.

The questions that face the music industry in the digital age, are mostly about how to collect money. Since the late 60's, the music business has enjoyed an economic boom never seen before, and the costs of bringing music to the public has became seriously over inflated. Today's music business has had to reassess every facet, and most of the music business is either getting out, or getting lean. There's just no room for fat anymore in here.

And how do the artists fair in my fantasy scenario? Well, one of the dirty little secret of the music business is that most artists in America have never lived on income derived from their record sales. In fact, it's not uncommon for artists at some major labels to have sold a quarter million albums, appeared on the covers of major magazines, performed live on national television and had their music videos played incessantly on MTV, but still they have not yielded a significant paycheck from their US record sales. The truth in the music business has and continues to be, that artists make their money through touring, merchandising, musical performances in films and in advertising and on publishing, not record sales.

So it's not surprising that musicians are jumping onto the virtual world to distribute their own music in record numbers. It gives them the possibility of economic control as bands now often begin their careers by negotiating their own deals online. And though downloaded music is not quite the norm yet, I imagine we're going to see a lot more digital downloading in the years to come.

This is Celia Hirschman for On the Beat, on KCRW.