The Revolution is Now

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The Revolution is Now
How the music business is changing overnight

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

To all the young, bright, energetic and enthusiastic music moguls of tomorrow, I have one piece of advice. Forget everything you've been taught in business school. The music industry changed overnight, and if you're not part of the new solution, you're definitely part of the old problem.

To the old school, sophisticated music business giants of the past, all I can say is - please - get out of the way. There's a revolution coming and it's taking no prisoners.

Imagine if you built your entire career on a solid foundation of good works and great rewards, only to have that reality torn down bit by bit, until you found that surprisingly, you were the problem holding up change for the better. This is what many executives in the music business are finally facing. Basically, the business has left their building.

But the sky is not actually falling. In fact, the music business is alive and well and living in computers, satellite dishes, iPods, PlayStations, televisions, radios and theaters. We've never had so much access to music before. In spite of all this access, the business still hasn't figured out how to properly monetize the consumer's experience of listening to music on line.

There's one nagging problem. A lot of people think music should be free.

Free is one of those great business headlines that always gets attention. &quotFree;" beats &quotcosts; money" every time especially when it's combined with quality.

The old record business reaction to the notion of free was to try and stop the wave. That has proved sorely ineffectual on many levels. And even if iTunes can build a huge monopoly on the backs of selling individual songs, there's absolutely no evidence that the record business can stay alive with that model. Buying tracks one at a time is definitely not the way to finance a multi-billion dollar business.

Just imagine if every time you wanted to watch a network television program, you had to put a dollar in your cable box. Pretty soon, you'd be limiting what shows you watched to avoid paying more money. The model that most the music business embraced is a fee paid for each track downloaded.

The TV world did it right. ABC, NBC and CBS are carried on cable companies around the country, but you'll never know the economics. That's because to the consumer, there's an illusion that these networks are &quotfree;" and &quotfree;" beats &quotcosts; money" every time.

To combat the idea of free, the music business is going to have to get smarter. They're going to have to bury the cost of music online in the cost of access by your service provider.

Imagine when getting broadband Internet service, you also get access to all the cds you could ever want. The couple of dollars a month extra you pay will hardly be noticed, and you won't be burdened with a per download price. Download to your hearts' content, or content, while the service provider invisibly distributes the appropriate income streams to labels and publishers, without a whole lot of fanfare.

The new paradigm is really all about overcoming the structure created by the old paradigm, in the quickest, most efficient way possible.

Welcome to the Music Revolution.

This is Celia Hirschman with On the Beat on KCRW.