from todays globe (boston.com)
Maybe ‘free’ doesn’t hurt music In the music industry, much of the last decade has been spent fighting the scourge of illegal downloading. While it’s pretty clear that sales have slumped, what’s not clear is whether society as a whole has suffered. In other words, has good music not been produced due to weakened economic incentives? An economist who sits on a National Academies committee on copyright policy thinks the answer is no. To create a consistent benchmark for the supply of new music, he integrated numerous retrospective quality rankings (e.g., Rolling Stone’s 500 best albums) going back decades to see if there’s been a drop-off in the supply of quality music since the advent of illegal downloading. He found no statistically significant change, suggesting that lower production incentives have been balanced by lower production costs.
Waldfogel, J., “Bye, Bye, Miss American Pie? The Supply of New Recorded Music since Napster,” National Bureau of Economic Research (March 2011).
I found the last sentence key. Not the statistical cost but the cost of production part. To extend it, the distribution cost, or at least the barriers to entry, are much lower as well. These are two arguments I don't see the "industry" addressing, much less considering.
1 comment:
Great find - and of course The Industry won't supply or pass along info that would hurt its mantra of "illegal downloading is the demise of civilization."
I attended a session at an internet marketing conference last month on the music industry's take on online advertising. I wanted a peek into what the bad guys at the major labels are up to. Turns out they throw so much money into google adwords campaigns for their "big" artists with so little return, there is literally no money left to fund bands that aren't Lady Gaga, Kesha, or U2.
I asked the panelists after the session what their advice would be for indie bands and basically the other 90% of artists out there that aren't getting any marketing attention by their labels. They said, pretty much exact quote, "that's what social media is for."
Very interesting.
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