Future Of Music

People should pay for their music the way they pay for gas or electricity.

I originally published this article in Forbes Magazine nearly 4 years ago.

“More people are consuming music today than ever before, yet very few of them are paying for it. The music recording industry blames file sharing for a downturn in CD sales and, with the publishing companies, has tried its best to litigate this behavior out of existence, rather than try to monetize the conduct of music fans. These efforts are fingers in a dike that is about to burst. Digital media are interactive, and people want music that they can burn to CDs, share and use as they wish. The music industry should instead look at turning this consumer phenomenon into a steady stream of cash–lots of it.

The industry ought to establish a “music utility” approach to the distribution and marketing of interactive digital music, modeled after the water, gas and electricity utility systems. It should be done voluntarily to work best for all parties, or it may eventually be legislated through a compulsory license provision.

Under a plan colleague Gerd Leonhard and I propose, con-sumers would pay a flat music licensing fee of $3 to $5 a month as part of a subscription to an Internet service provider, cellular network, digital cable service wireless carrier or other digital network provider. This fee would let people download and listen to as much music as they care to, from a vast library of files available across the networks.

These fees would result in a huge river of money. With approximately 200 million people connected to a digital network in the U.S., the potential annual revenue stream for a music utility model could be somewhere between $7 billion and $12 billion for the basic service. That is already comparable in size to the existing U.S. recorded music market, which in 2003 was $12 billion at retail, according to the Recording Industry Association of America. This basic service would be augmented with various opportunities, including packages of premium content, live concerts, new releases, artist channels, custom compilations and more. The revenue potential of these premium sources is enormous, too.

How would this money be divvied up? We propose that the industry voluntarily establish a “music utility license” for the interactive use of digital music. This license would compensate all rights holders, including the record labels and artists (for the master recording) as well as publishers and composers (for the underlying composition), with the license fee to be split in half between the owners of the sound recording and the owners of the composition, after deducting a percentage for the digital network providers. This license would be available to anyone willing to implement its terms. The digital network companies would be required to track and report which music had been used, by employing existing digital identification and tracking technologies.

There is already precedence for such a flat-fee system in cable television and in the utility-like models of public broadcasting in Europe. Streaming digital music is already provided in basic cable plans. Cable television itself at first resisted this model, but its economics eventually led to a larger market, providing more consumer choice and more revenue streams overall. Old media almost never die. Cable television did not replace broadcast television; instead, it expanded the market dramatically, by letting video flow like water into new revenue streams–instead of down the drain.

Certainly a music utility would be a radical and complex undertaking, and there are many important details to negotiate, such as the exact nature of the license, how the funds would be administered, the specific tracking method, what collection of technologies would be employed and others. Yet there are inventors and technologists outside the mainstream music business hard at work trying to figure out how to make this happen. It’s time for the main players in the music business today, namely the large record publishers, to cooperate with the inventors and jointly create a future for music where the money really flows and the global market for music can grow from $32 billion to as much as $100 billion.”

Read the original article from Forbes here, published in 2005.

Today this idea is closer to reality than you might think.  The major labels have seen their revenues cut nearly in half from their peak, and paid digital downloads and advertising models have not grown to contribute nearly the decline in CD sales.  The labels are in a very tough position and are looking at the utility model as perhaps their only remaining path to survival.  The pain has finally gotten too much to bear.

Choruss is a new company spearheaded by Jim Griffin, and incubated by Warner Music Group whose mission is to “build a sustainable music subscription platform providing unlimited access to music for a flat monthly fee”.  Choruss has been diligently acquiring the required licenses from all the “major labels”, independent labels including aggregators A2IM and Merlin and the National Music Publishers Association.  The company has been granted one-year licenses for up to seven universities to offer subscription services for unlimited, DRM-free downloads as a proof of concept.  This trial is set to begin in 2010.

Stay tuned for more info…

You want to be a renegade. Take a great idea and run with it, before everyone can ask what you are doing, and then explain it all later.  This is a much better operating mode than asking for permission.  Far more can be accomplished in a shorter period of time, and often with unexpected and wonderful results.

In 2001 we brought our online music school at Berkleemusic to market and began a transformation in how music is taught and who could participate in both the teaching and learning experience.  At the same time we developed Berkleeshares as a platform to freely distribute music lessons around the globe.  Now some 8 years later, many millions of free music lessons have been downloaded from Berkleeshares and tens of thousands of students from around the world have studied music with Berklee from afar.  Our online lessons are in use in hundreds of schools around the planet likely influencing hundreds of thousands of music students.

Our YouTube channel has become one of the most visited educational channels on YouTube, fueled by music and passion and people who chase the dream of becoming a musician.

I came across this article in Fast Company on the EduPunks, and how they are transforming higher education.  It made me realize that we have already taken the first step in remaking the music business from the inside out, as we train the next generation of digitally savvy musicians, songwriters, producers and music business people.

“The transformation of education may happen faster than we realize. However futuristic it may seem, what we’re living through is an echo of the university’s earliest history. Universitas doesn’t mean campus, or class, or a particular body of knowledge; it means the guild, the group of people united in scholarship. The university as we know it was born around AD 1100, when communities formed in Bologna, Italy; Oxford, England; and Paris around a scarce, precious information technology: the handwritten book. Illuminated manuscripts of the period show a professor at a podium lecturing from a revered volume while rows of students sit with paper and quill — the same basic format that most classes take 1,000 years later.”

The scarcity that has propelled the music business for the past 70 years or so is not unlike the scarcity that has propelled the education business.   Schools have a lot to learn from the music business and they better pay attention.  When most of the value of an experience can be reduced to ones and zeroes, the entire bottom can fall out of the business, faster than you can even imagine.  This is what is starting to happen to education.

“Colleges have become outrageously expensive, yet there remains a general refusal to acknowledge the implications of new technologies,” says Jim Groom, an “instructional technologist” at Virginia’s University of Mary Washington and a prominent voice in the blogosphere for blowing up college as we know it. Groom, a chain-smoker with an ever-present five days’ growth of beard, coined the term “edupunk” to describe the growing movement toward high-tech do-it-yourself education. “Edupunk,” he tells me in the opening notes of his first email, “is about the utter irresponsibility and lethargy of educational institutions and the means by which they are financially cannibalizing their own mission.”

The edupunks are on the march. From VC-funded startups to the ivied walls of Harvard, new experiments and business models are springing up from entrepreneurs, professors, and students alike. Want a class that’s structured like a role-playing game? An accredited bachelor’s degree for a few thousand dollars? A free, peer-to-peer Wiki university? These all exist today, the overture to a complete educational remix.

The architects of education 2.0 predict that traditional universities that cling to the string-quartet model will find themselves on the wrong side of history, alongside newspaper chains and record stores. “If universities can’t find the will to innovate and adapt to changes in the world around them,” professor David Wiley of Brigham Young University has written, “universities will be irrelevant by 2020.”

Well – for me this means that we better keep peddling hard at Berkleemusic, and continue to experiment with new technologies and modes of teaching and learning so that we don’t end up without any real business, like the situation that the major record companies are in today.  Expect to see new products and services from Berkleemusic in the coming months and years that align with the changing digital marketplace.  Afterall, if we are not willing to change with the times and improve what we do at Berklee, how can we expect our students to do the same thing?

Read more on the Edupunks here at FastCompany. The comments at the end of the article are fascinating.

Get Busy Committee

My friend Ian Rogers, CEO of Topspin has started to co-manage the band “Get Busy Committee“.  He has begun to blog about ALL the activities that an artist manager needs to drive their band to success.  It is a fascinating read and a real world education on how to take a band to market in the new music business.  This is going to be really fun to watch as Ian lays out step by step what he is doing to break this band and “get busy” in the marketplace.

To bring a band to market in today’s indie music market is a hell of a lot of work.  You need to be an entrepreneur and you need to build a team of people to help you market, package, promote, distribute, brainstorm, license, and develop a successful artist.  Ian is taking the indie artist management route described at Music Power Network.

Here are some excerpts from his blog.  Required reading for the indie artist and manager today:

The first thing we did was define success: as I mentioned earlier, the goal is to get this music to as many people as possible, connect directly with the ones who like it, build products those people want to own, and turn a profit. Sure it would be great to make enough money that Get Busy Committee could be their primary income, but we definitely aren’t starting with the “if we don’t get a song on a radio this is a failure” mentality. We are starting at zero. The goal is to grow every single week and not lose money.

We started by putting together a release plan. I opened a Google Doc and started dropping ideas and info into it, and encouraged others to do the same. We needed a team, so we started assembling the roster of people, services, and tools which would help us get this record out the door:

Building a Team

Press Relations and Marketing
Creative Direction
Web site design and development
Digital distribution
Physical Distribution
Non-traditional physical manufacturing
Performing rights organizations
Legal

While getting the album to iTunes is the main thrust for a lot of artists, it’s only part of the story (and a very small part so far) for us. We’ve been preparing for this release for months, started selling the album in six different package two weeks ago, are selling the album for $1 on MySpace all weekend, and much more.

Web Site

The object was to make the site:

Home base. The top SEO result for “Get Busy Committee” and anything else related to the band.

Vibrant. It should update with the latest information about Get Busy Committee with very little effort, from a variety of sources. Furthermore, we weren’t going to spend time or money building any of these tools from scratch. We integrated WordPress and Twitter to make sure it was easy to update with long or short-form updates (respectively) easily.

A fan acquisition tool. The site should be sticky like fly-paper. If you visit the site you should have an incentive to leave behind your email address, follow GBC on Twitter, become a fan on Facebook, a friend on MySpace, friend on Flickr, subscriber on YouTube, or subscribe via RSS. We may only get one chance to make a connection with you. We don’t want you to bounce in and bounce out without granting us permission to reach out to you later with an update.

A tool for fans to create other fans. Every page of the site is instrumented with simple ways to share on Facebook and Twitter, and feedback for having done so either in the form of a counter or free music for having done so. We want it to not only be easy to spread the word but for you to be recognized for having done so.

A place to convert at whatever level of fan you happen to be. Never heard of Get Busy Committee? No problem, you can stream the record or download a few songs for free. Super fan? How about the T-Shirt/USB Flash Drive combo for $55? Somewhere in between? No worries. We have something for you.

Useful. If you’re a college radio DJ who needs a clean version to play on your show or a beatmeister who wants an acapella to remix that should be easy to find. If you’re a blogger writing about the band there should be, even if it’s not linked from the front page. Anything you email to people regularly should be on the site and easily linked to.

Read much, much more about marketing, pricing, making connections, creating awareness and all the things a smart artist manager needs to know.  Brilliant!

Thanks Ian.

Distance learning has come a long way. Once the domain of dubious “as seen on TV” correspondence courses promising diplomas in such arcane disciplines as air conditioning installation and VCR and gun repair, distance education has entered the mainstream. Today, institutions ranging from the Ivy Leagues to local K-12 programs offer virtual coursework on their Websites, iTunes, YouTube and Second Life. Originally designed for working adults, online courses are now a real component of every phase of “traditional” education, and for a generation brought up on the Internet, the transition is seamless. According to the U.S. Department of Education, 66 percent of post-secondary learning institutions offer distance learning programs, with 12.2 million enrollments in college-level credit-granting distance education courses in 2006-07.

The immediate benefits are obvious: Online courses offer flexibility and convenience; and students can usually log in anytime, anywhere. Classes are generally available on an affordable a la carte basis — and with the average yearly tuition at a four-year college creeping over $25,000, cost is certainly a consideration…

Web-based audio curriculums are exploding: Berkleemusic.com, which is largely recognized as the pioneer of online audio education, leads the market with the world’s largest catalog, offering more than 100 accredited courses and 30 certificate programs to more than 25,000 students in 90 countries…

At Berklee College of Music, distance learning tools are a far cry from the mail-in music theory correspondence courses the school offered back in the ’50s, but the goals are the same: to connect Berklee’s instructors and curricula with a global network of musicians. According to Debbie Cavalier, Berklee’s Dean of Continuing Education, the scope and learning outcomes for Berkleemusic.com courses are similar to Berklee’s face-to-face environment, but the path to get there is different. “We’ve structured our online courses to address many different learning modalities,” she says. “Text, audio, video, live chat, discussion board activities, Flash interactions and hands-on projects are all provided throughout the lessons to help students gain knowledge through their preferred learning style.”

At Berkleemusic, students can enroll in individual classes or work toward an intensive three-course Specialist Certificate; four, five or six-course Professional Certificate; or an eight, nine or 12-month Master Certificate. Classes run 12 weeks and cost $995, or $1,195 for college credit. Each week, students work through the lesson material, post questions, upload assignments, listen to and critique each other’s work, answer questions, interact with their instructor, receive feedback on weekly assignments and participate in a weekly class meeting online. “The class community becomes a vibrant online learning environment with lots of communication and musical exchange,” says Cavalier. “Students who are new to Berkleemusic are often surprised by how much they learn, how rigorous the Berkleemusic online courses are and how connected they feel to their classmates and instructor throughout the 12-week term.”

Cavalier adds that Berklee’s online classes are ideally suited to hands-on learning. “For example, a Mixing and Mastering in Pro Tools course may include a lesson topic on applying parallel compression to guitar tracks in a mix,” she says. “Students read about the concept, look at diagrams, watch the instructor demonstrate the technique in a movie file and then try to apply parallel compression with the Pro Tools session provided for that lesson. Each student uploads their version of the technique in their Pro Tools session for the instructor to review and critique.” Files are transferred via DigiDelivery, and students submit mixes as MP3s.

Berkleemusic professor Erik Hawkins, who teaches music production courses such as Pro Tools 110 and Producing Music With Reason from his home studio in Los Angeles, says he strives to keep class content accessible and interesting to all levels of students. “Students who are new to music production can jump in at the basic level with videos and interactive Flash workshops, while more advanced students can dive into discussion questions at more length and tackle the extra challenge portion of a weekly assignment,” he says. “There’s something for every level, and you can pick and choose the materials within a lesson that best suit your personal goals for the topics presented.”

Hawkins spends the first few weeks making sure that everybody understands the basics of the music software programs that the class is working with. “This frees up the remaining weeks for getting creative,” he explains. “For example, beginning in week eight of the Producing Music With Reason course, students start writing and producing their own song that I expect them to have completed, mixed and mastered by the end of week 12 of the course. And in my Remixing With Pro Tools and Reason course, students complete three remix sketches as a warm-up for producing a full-length remix beginning in week seven. It’s an intense ride, but there’s no better way to hone your music production chops than to apply the production techniques that I’m teaching in the lessons to actual projects.”

Terri Winston, executive director of Women’s Audio Mission and professor of Recording Arts at San Francisco City College, says online education is a great way to reach people who wouldn’t otherwise have access to training and to get more people interested in studying audio — but it has its limitations. “They can get introduced to the theory, history and the basic concepts of audio and then hopefully this motivates them to get into a studio classroom environment to learn the hands-on and workflow portion of the craft,” she says. “Now, taking the online concept too far by eliminating the group learning environment makes it too comfortable and prevents students from learning the difficult and critical people skills that are required in this industry.”

Winston believes online learning can augment training, but only a group, in-studio learning environment can teach studio etiquette, workflow, group dynamics and people skills. “One of the most important requirements to be successful in this industry is the ability to work well with people in high-stress situations,” she says. “It’s important for students to get themselves in those environments as often as possible so they can see what this actually feels like and learn what is appropriate behavior. You need to have the adrenaline of getting chewed out on a session to really learn that.”

“There is no substitute for being in the room with great engineers and absorbing their techniques,” Gottleib adds.

That said, the notion of the “real world” is evolving, and smart students are exploring new models of working. “Global collaboration is taking place in all sorts of industries,” says Garcia. “In recording, people are collaborating and working together more without being in the same studio. I think distance education actually prepares you for that new world, where you are working with people who you don’t see, people you are not in the same room with.”

Ultimately, online education is just like most things in life: What you get out of it is in direct proportion to what you put into it. “It is an utter myth that online or distance learning is simply a bunch of resources made available online — it is not,” says Hambly. “What is essential is carefully crafted pedagogical systems where a relationship forms between the student and his or her peers and learning advisor. If potential students find that the courses are without appropriate advisor moderation and guidance, my advice is to stay well clear of them as you will not be getting a valuable educational experience. It is in the interaction, or, ‘social learning,’ where the real learning takes place.”

Read the whole article from Mix Magazine here.

I don’t know, I could be wrong about this, but something is not right.  Google has finally entered the music space with it’s One Box music search feature in brilliant fashion, well position to become the new radio, complete with favoritism and major label cronyism.

Google is now going to serve up links to songs from major online retailers at the top of it’s search page, whenever you search on a song name, or artist name, or lyric.  It will let you play the song once, and then take you to an option to purchase the song or subscribe to a major music service.  The other search results are pushed down the page.  Except for the ads, of course.

I was at the Google Discover Music Launch Event in October ’09 in LA.  Google’s VP of Search Products and User Experience Marissa Mayer said that “Music is one of Google’s top ten searches of all time, as is lyrics.  But it hasn’t always been easy to actually find music, which is why Google is looking to offer full song streaming directly from Google.”   What is this bullshit all about?

Does a band actually have to buy an ad now in order to be above the fold in Google search results?

Is the only way to be at the top of the page to sign a deal with a major label or online retailer?

What about a level playing field?  How about putting the fan in control?

And what is this about Vevo,  a service Google is reportedly developing with Universal, Sony and some investors from Abu Dhabi?

This all sounds very suspicious to me and I need to know more…

Read more about Google music and independent artists at Music Power Network.