[IP] Musicians Looking To Let Internet Replace Record Cos
Delivered-To: dfarber+@xxxxxxxxxxxxxxxxxx
Date: Tue, 27 Jan 2004 11:45:29 -0500
From: Barry Ritholtz <britholtz@xxxxxxxxxxxx>
Subject: Musicians Looking To Let Internet Replace Record Cos
To: dave@xxxxxxxxxx
Hi Dave,
For IP if you like: Fascinating story out of Davos -- Dow Jones ran a very
different headline than the rest of the media on the AP Peter Gabriel story
(it actually shows up under news for AAPL on the Dow Jones Newswire).
I think this is an EXTREMELY significant development, and should be of
great concern for the labels going forward. I haven't done a mathematical
analysis, but I did put up a quick post regardimg some of the potential
developments going forward.
This is definitely an intriguing issue worth watching. My quick take is below.
Cheers,
Barry L. Ritholtz
Market Strategist
Maxim Group
405 Lexington Avenue,
New York, NY 10174
(212) 895-3614
(800) 724-0761
Musicians Looking To Let Internet Replace Record Cos
http://bigpicture.typepad.com/comments/2004/01/musicians_looki.html
At least, that's the headline which Dow Jones ran for this story. Most
everyone else who ran this AP story used the tamer headline: Musicians
Unveil Digital 'Manifesto'.
But I suspect that Dow Jones got the basic premise correct: A highly
respected and intelligent pair of innovative musicians are making a power
grab on behalf of artists. They are taking advantage of the general chaos
in the space, and the apparent cluelessness of the big labels vis-a-vis the
internet.
In other words, the music industry's Hell just got a lot hotter.
Consider the players: Gabriel is an extremely bright and creative musician.
He has been a major innovator in his entire career, from recording with
Genesis and on his own to live performances to social activism (on both
Human Rights and the Environment, and is also associated with WOMAD) to his
music business savvy. Gabriel owns recording studios, is a co-founder of
the digital downloading service "On Demand 2" (OD2), and founded his own
label, RealWorld.
If you followed Gabriel's career -- and his music -- over the years, than
you know that he is not a mainstream thinker. I have a sneaking suspicion
that Peter is a disarmingly charming and formidible (if not clever)
negotiator. Now, along with his cohort, Brian Eno, the Music Industry's
nightmare may have just gotten much worse.
Gabriel & Eno present an opportunity to turn the classic rocker cliché on
its head: Think of a group of stoners, signing anything their label
presents to them, while corrupt agents and business managers bleed them
dry. Now imagine the polar opposite of that vision: That's Gabriel & Eno.
Long term survivors of the industry, they are smart enough not to confront
the industry head on -- they certainly do not want to turn this into a holy
war. Instead, they are proposing a set of changes -- incremental in
appearence -- which will gradually reduce the power of the record labels in
favor of the musician. Gabriel is smart enough to retain a role for the
labels, primarily that of marketing. That makes their model a compromise
between the anarchy of P2P, and the disintermediation of a "labelless" pure
internet model.
This may ultimately change the economic dynamics of the industry, reducing
the role of the labels. Eventually, the changes could be dramatic.
CANNES, France (AP)--Peter Gabriel and Brian Eno are recruiting other
musicians for a provocative online experiment: Since the Internet has
changed the way fans buy and listen to songs, they say, why not transform
the music itself?
The two independent musicians have dreamed up an online alliance for
musicians, and they hope to launch within a month. By taking record labels
out of the equation, artists could put downloads online themselves,
becoming their own retailers and setting their own prices. They call it the
"Magnificent Union of Digitally Downloading Artists" - or MUDDA for short,
which has a less lofty ring to it. On Monday, Gabriel and Eno handed out a
slim red manifesto at a huge dealmaking music conference in southern France.
Do you have any doubt that what these gentlemen are proposing is anything
short of a major revamping of an industry? Than read on:
Gabriel, who has his own label, Real World Records, said he isn't trying to
shut down the record companies - he just wants to give artists more
options. "There are some artists who already tried to do everything on
their own," he said, adding that they often found out they didn't like
marketing or accounting. "I think we believe there will be all sorts of
models for this."
One band that has found its niche online is the jam band Phish, which sells
downloads of its concerts at www.livephish.com. The band's relationship
with its devoted fans is often compared to that of the Grateful Dead, and
the site is another chance for close contact. But it also made money: $2.25
million in sales since 2002. What's driving the movement is the success of
legitimate download sites such as Apple's Internet music store, iTunes,
which sells songs for 99 cents a pop in the U.S.
Gabriel co-founded a European company, On Demand Distribution, which runs
legal download sites in 11 European countries. The company would provide
the technology for MUDDA, though Gabriel and Eno are looking for online
partners.
Stay tuned . . .
Sources:
RealWorld
http://www.realworld.co.uk/index/flash/
Musicians Unveil Digital 'Manifesto'
Associated Press, 1/26/04
http://abcnews.go.com/wire/Entertainment/ap20040126_1514.html
What Peter Gabriel gets out of Davos
By Tim Weber, Monday, 26 January, 2004, 09:04 GMT
BBC News Online business editor in Davos
http://news.bbc.co.uk/1/hi/business/3428437.stm
Gabriel to launch musicians' union
By Tim Weber Friday, 23 January, 2004, 17:19 GMT
http://news.bbc.co.uk/2/hi/business/3424483.stm
Musicians to Use Internet To Bypass Record Labels
Associated Press
http://online.wsj.com/article/0,,SB107516464904012346-search,00.html
Musicians Looking To Let Internet Replace Record Cos
DOW JONES NEWSWIRES
http://online.wsj.com/article/0,,BT_CO_20040126_006186,00.html
**********************************************************************
This message is intended only for use by the intended party and may contain
information that is privileged and/or confidential. If you are not the
intended recipient, then any review, dissemination, replication or
distribution of this communication is strictly prohibited. If you have
received this communication in error, please notify us immediately and
delete this message and all attachments.
Electronic communications routed to any employee of Maxim Group LLC
("Maxim") are for business purposes only. While messages are confidential,
authorized management, legal and compliance personnel may review
electronic messages. Electronic messages are also retained and would be
provided upon request to an authorized regulatory body.
Do not use email or instant messaging to request, authorize or effect the
purchase or sale of any security, to send fund transfer instructions or to
effect any other transactions. Maxim does not accept responsibility for
transmission via electronic means of trade orders. No guarantee can be made
by Maxim of timely execution of any trade order transmitted via electronic
means including email and instant messaging.
Information included in this email does not constitute a trade confirmation
or an offer or solicitation of an offer to buy/sell securities. Past
performance is not indicative of future returns.
**********************************************************************
-------------------------------------
You are subscribed as roessler@xxxxxxxxxxxxxxxxxx
To manage your subscription, go to
http://v2.listbox.com/member/?listname=ip
Archives at: http://www.interesting-people.org/archives/interesting-people/