ThoughTech

Wednesday, December 08, 2004

The Maiden Voyage of ThoughTech

Hi all! I am hoping to turn this venture into a place for all to post their thoughts on the political and philosophical aspects of technology! I hope for it to be an open forum, as well as a conduit for public expression and debate. I am looking for people to write some articles here, and I want ANYONE who comes here to feel free to post their responses. However, I also want all who post here to be respectful of others' opinions. Below is ThoughTech's first article: a few of my thoughts on the nature of the music industry and how p2p fits into the mess that has been created.

Happy Hacking!

Greg

1. There is no competition in the music industry:

Take the example of the automotive industry. In America, consider two of the largest automobile manufacturers, Ford and Chevy. Now, consider one portion of the industry (we'll say genre of vehicle to establish my analogy.) The genre is trucks, which appeal to one segment of the population: rednecks*. Now, a redneck that wants to buy a pickup truck from Ford will not buy from Chevy, and vice versa (due to brand loyalty, or pricing issues, whatever). So, the car companies raise quality, and lower prices to try to get him to buy their vehicle.

Now, let us apply this concept to the Music Industry. We have Record Company A (RCA) and Record Company B (RCB). One genre of their product (Pop Music) appeals to one specific segment of the population (Pre-pubescent girls). Now, If a pre-pubescent girl wants to buy a cd, she can choose BackdoorBoys ("owned" by RCA) or N'stink ("owned" by RCB) however when she acquires one of these albums, that doesn't detract from her percieved "need" to acquire the other as well. Even though the two bands are marketed by different enterprises, they don't compete for listeners.

* I myself am a redneck, so I can say that... :-)

2. The market has endured abuse from the supposed "leaders" industry:

As is described here the RIAA has been the defendant of at least one class-action suit for price-fixing. Price-fixing constitutes downright misuse of the nature of the intellectual property market. Doing such things drives away customers and causes mistrust of the industry hurting both present and future innovators.

Now the clincher.

Ordinarily, a market that had been abused by either buyer or seller would, in time, be able to recover after the abusive actions had stopped occurring. How would it do so? In this case, healthy competition for consumers would reduce prices back to fair market value. However, as cited above, the music industry doesn't function through a competition-based model. It seems that apart from the market, a competitor (which we know as File-Sharing) has evolved, and the RIAA finds itself at odds with a FREE industry. That is where we are today.

So, where do we go from here?

I, for one, believe that p2p is not truly "free". I believe that every p2p user pays a price for downloaded music with his conscience, knowing that there is an artist that, had he bought the CD, would've gotten two-tenths of a cent from that one song he just downloaded. (times 20 songs makes 4 cents a disc, which, from what I understand, is about how much most of them get. Also, notice that my "guilt as a cost" model here isn't guilt for not paying for the music, it is guilt that the artist didn't get their due.) To sum up, I think that the RIAA should do what every other industry does when they are "losing market share" and lower their damn prices. When the prices get to a fair level, I believe that the consumers will return to the fair market, because they know that then, it is the right thing to do.

Looking aheadan ounce of prevention:

I also have a theory about how to prevent such a situation from rising in the future. By no means is my plan perfect, (I am a Sophomore in college, for crying out loud!) but I believe the changes entailed would be for the better concerning the music industry. The US should pass a law concerning Intellectual Property, (IP) that when an artist is licensing IP to a company such as a recording company:

1. They must do so one work at a time (ie: The norm of a production contract automatically usurping "everything you write" as is common with musicians today would be null and void)
2. That ownership rights to intellectual property may not be sold or transferred in any way except by inheritance. If one has created intellectual property, he may license it to as many parties as he wishes. Any contract stating otherwise is null and void.

My vision for this is that big name artists would be able to sell the exact same album through multiple record labels. After this trial and error, the artist chooses to do business with the one that best satisfies their needs (by making them the most money or selling the most records), but is not contractually bound to do so, and may seek another publisher should the relationship sour. The effect: disc prices drop, only the toolish share music illegaly, and everyone gets along. Also, (and, ironically this is probably the most important effect) I believe it would be a step toward re-establishing content providers as the leaders in the industry, rather than indentured servants at the mercy of what a publisher believes will be "popular".
End of Story