domingo, janeiro 29, 2006
Getting a record deal used to be the prerequisite for fame and fortune. If the industry does not act fast, it may become an afterthough
But with new bands giving their music away to build up a fan base, continued price pressure from retailers and mobile phone operators selling 'all you can eat' subscriptions offering thousands of songs for a few euros a month, the traditional single increasingly looks like something which will be given away to sell other products - albums, iPods or mobile phones.
Record companies, whose business model looks as dated as their vinyl-era name, should give new singles away for free, just as Unilever gives away sachets of shampoo to persuade consumers to buy the bottle. Doing so would undermine illegal distributors more effectively than any lawsuit and force companies to focus on parts of the business where there is still good money to be made.
The strength of live music and ringtone sales shows consumers will still pay for unique experiences and good gimmicks. Recorded music companies have had little or no control over merchandising, touring or management. They should rethink this. They should also invest the savings offered by digital distribution in hunting for talent amid the cacophony of music available online.
The change will be painful, as cost structures will have to adapt to the new pricing environment. That may mean more consolidation, and a rethink of the industry's lavish lifestyle (perhaps next year's conference should be in Sheffield rather than Cannes). But it is essential. Getting a record deal used to be the prerequisite for fame and fortune. If the industry does not act fast, it may become an afterthought.
The writer is the FT's media editor"