Major Labels clinging on via Spotify

This was the unofficial tombstone of the major labels as it hung omnipresently at MIDEM 2009.

midem billboard 2009
Paul McGuinness (U2’s manager) was making a desperate plea not to drive any more nails into the already closing coffin of the ‘established’ music industry. he wanted the UK Government to close down all ISP’s guilty of providing conduits for illegal music files.

As an independent observer they came came across as desperate pleadings from a naive dinosaur.

3 years on and we have an uneasy tension. The majors have cut down on their rosters. They have embraced Spotify (The majors own a controlling share in the annoying ad revenue stream based system). So artists are still getting a raw deal and the major labels (Much like Hollywood will do with film) are still clinging on to power.

I watched the sad story of Creation Records (Upside Down) last night. A clumsy helter skelter of excess which Sony Music swept up (much to its own delight), when the wheels inevitably came off. Not sure i would have bought all those MBV, Ride and Swervedriver records if i’d known McGee and Co were snorting all the proceeds and stiffing the company in the process.

But what’s that got to do with piracy, I hear you ask. Well the music ‘industry’ just got smart. Independent developers now dictate the future. McGee’s modern day equivalent is a nerd poring over source code with strong coffee keeping him going through the night. Independent labels and start ups got smart. Developers have their own conferences and hubs at music fairs such as MIDEM and SXSW. The major labels are attempting to poach all the best ones. They’ll inevitably succeed to a certain extent but there will always be the politically driven spirit of independence amongst developers. Call it the apple ethos, the anti-establishment doctrine. Whatever, they are here and now hold the balance of power.

Spotify is having its day in the sun but looks unsustainable from an artists point of view. My view is that the fans are becoming more empowered and Spotify is not a ‘working’ model. It’s an attempt by the major labels to seize back control. Fans need to dictate prices or download for free. Statistically, users who download free tracks also spend the most money on music.

Neil Young’s comment that illegal downloading was the new radio was well timed and astute. How will this empowerment be harnessed. Enter a third way!


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