The future of the Music Industry? by John Chambers jc@trillian.mit.edu November 2000 A coworker at a recent job had an interesting hobby that was slowly turning into a full-time business. It may be the future of the music industry. He was really into new, experimental music, and knew a lot about the Web. So what he did was create a web site for the use of the local bands playing this music. He would accept recordings from them, convert them to MP3, and put them up in that band's directory for anyone to download. He also supported email and chat groups for each band. He charged the bands just enough, I think it was about $10 per month, to cover his costs. He had dozens of bands on his site. And he gets into any of their gigs for free, of course. What makes this interesting is that he has also had to start producing CDs for the bands. This tends to confound those not familiar with Web economics, but in fact it's common. A CD is a very convenient way to carry around music. After a band gets a small following and has a set of tunes online that people like, requests for CDs start coming in. But these CDs don't get produced quite like the recording industry makes them. A common problem with commercial "albums" is that you typically get one or two cuts that you like, and the rest are just filler (from your point of view). The musicians are as frustrated by this as the listeners, but there's little you can do about it. The real problem is that there's no way to get any listener feed back until the CD is out there for sale. But things are different in this case. What happens is that a band is at first surprised by the requests for CDs. "They're willing to pay for music that's free?" Then they start to take it seriously. They discuss the CD with their online friends, and together a set of tunes is worked out. Probably by this time most of the tunes have gone through a number of versions. The fans have criticised them, often ruthlessly. The band doesn't always agree, but listens and makes more versions. Finally they decide they've worked it all out, and a CD is made. Most of the fans order a copy, because nearly all the cuts are good (by their standards). The price is lower than commercial recordings, all the cuts are keepers, and the band gets half the money. The fellow who was running all this had started to mumble about quitting his day job after the next layoff and using his "hobby" to build up his retirement fund. He also really liked the idea that he was doing an end run around the turkeys in the recording industry, who act mostly as a barrier between the musicians and their audience. He was also helping friends in several other cities set up their own local-band web sites. Anyone interested should do a bit of looking around, and start doing the same in your area. With a bit of work, we can kill the recording industry and replace it with a direct musician-to-audience system, complete with good feedback.