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Steve Gilliard, 1964-2007
It is with tremendous sadness that we must convey the news that Steve Gilliard, editor and publisher of The News Blog, passed away June 2, 2007. He was 42.
To those who have come to trust The News Blog and its insightful, brash and unapologetic editorial tone, we have Steve to thank from the bottom of our hearts. Steve helped lead many discussions that mattered to all of us, and he tackled subjects and interest categories where others feared to tread.
Please keep Steve's friends and family in your thoughts and prayers.
Steve meant so much to us.
We will miss him terribly.
Ice Weasel: "Victims of self-inflicted wounds"
Cool graphic! Miss records.....
Thanks to Ice Weasel for this awesome take on the record industry
The NYT's Spinning Into Oblivion is yet another crack at the
music industry (an industry which deserves more than a few "cracks").
However, written by two independent retailers, it's only part of the story
and, it's not all that much of expose, more of a mea culpa.
I'll add some bits from that piece here as way of an introduction
into a larger point."when we opened an independent CD shop on the Upper West Side of
Manhattan in 1993. At the time, we figured that as far as business
ventures went, ours was relatively safe. People would always go to
stores to buy music."
Eh? Seriously, eh?! I've been involved in the music business since
the late seventies at no time in the last three decades was an
independent store more than an extreme gamble in a very tough
environment. But that's ok, reality intrudes in the next paragraph..."Fourteen years later, it’s clear just how wrong our assumptions
were. Our little shop closed its doors at the end of 2005."
Given the relative cluelessness exhibited in the first paragraph, I'm
surprised they lasted that long. That said; they wised up pretty well."The sad thing is that CDs and downloads could have coexisted
peacefully and profitably. The current state of affairs is largely
the result of shortsightedness and boneheadedness by the major record
labels and the Recording Industry Association of America, who managed
to achieve the opposite of everything they wanted in trying to keep
the music business prospering. The association is like a gardener who
tried to rid his lawn of weeds and wound up killing the trees instead."
Sort of. I think the thing missing here isn't that the industry
"killed the trees" they killed everything with the exception of the
one thing they wanted to kill, "the weeds", namely, digital
distribution. And, as important, indie retail has been, in their own
way, as resistant to change and truly serving the customer as the
labels ever were."Something had to be done to save the record store, a place where
hard-core music fans worked, shopped and kibitzed... "
Really, why? As much as I love some retailers, as I mention above,
most retailers were as clueless and bad to their customers as the
labels were. So the idea that consumer loses because record stores
go away isn't one that is supported by the evidence. That evidence is
in the millions of downloads from online retailers such as iTunes.
In fact, consumers want to buy single songs, at home, whenever they
want for much less than the record store could or would sell them
for. And, they want a diversity of selection that very, very few
stores ever endeavored to present."But instead, those labels delivered the death blow to the record
store as we know it by getting in bed with soulless chain stores like
Best Buy and Wal-Mart. "
Absolutely. The labels did everything they could, not so much with
the intention of but with the unavoidable result of helping to kill
indie stores. However, I want to point out, this was well under way
by the mid nineties."A year after our shop closed, Tower went out of business — something
that would have been unthinkable just a few years earlier."
Tower went of business for several reasons but the idea that Tower
going buns up was "unthinkable"? Not at all. Tower was suffering
from a number of problems as early as 1995. That they lasted as long
as they did given their utterly incoherent business strategy and
their dreadful staffing is what is surprising.
Example, one of Tower's biggest inner joys was how they had created
separate sub-company to handle all their advertising. This allowed
them to rake in another 15% advertising commission on all the ads
they placed (and being one of the largest chains, they raked in a
lot). Problem was the "separate entity" booked a lot of ads that
made no sense and really didn't help the business. Sure, they got
their 15% but they also lost sight of what the purpose of that
advertising was. Russ Solomon, founder of Tower Records had a vision
that, back in the early seventies was revolutionary. He wanted to
"stack the product in the aisles" and offer more titles than any
other music store. As time went on, other people stacked stuff in
aisles and the selection in his stores wasn't all that great (for a
number of reasons).
Finally, the wrap up of the Times piece is..."We would be gloating, but for the fact that the occupation we
planned on spending our working lives at is rapidly becoming
obsolete. And that loss hits us hard — not just as music retailers,
but as music fans."
Bah. There is no better time, ever in history, than now for the
music business. The business is in the process of redefining
itself. Sure, there are new challenges out there for entrepreneurs
in the music industry but finally; many of the hurdles are also
disappearing. What these people are bemoaning, rightly or wrongly,
is their desire to work, forever, locked into some High Fidelity
model whereby they get to stand behind the counter and point "over
there" and smirk when customers ask for something.
In 1998 I wrote a report for the National Association of Independent
Music Distributors (an association of indie stores and distributors,
sort of the indie counterpart to NARM which is one of the main
driving forces behind the widely acknowledged evil that is the RIAA)
entitled, "The Perfect Record Store". The report was a critique on
indie retail and some potentials avenues indie retailers could
explore to help themselves.
I can't find the report (it's probably on an archive disc somewhere)
but I do recall enough to over-simplify and summarize it here
----What will record stores look like in ten years? Think of something
more akin to a coffee shop than the store you're in now. Your
customer will come for the same thing they always have, music but
they will be buying it in different ways. You'll have kiosks or
tables with computers where you customers will download music from
remote servers and they'll use your facility to print the booklets
and burn the discs. They'll bring their MP3 players and connect them
to your computers to download music as well. (ed note: I had seen
the Diamond Rio player the previous at CES and was blown away by the
implications) Because the memory of the MP3 players is so limited,
they'll visit your store frequently to download new music. They'll
come to your store for what they always have, to get inside
information from your staff and to talk with other buyers. The real
security in this business model is that you're not just selling
music; you're selling the experience of buying music. Your new store
will make the experience something the customer will value. Gone
(and thankfully so) will be row upon row of dusty CDs in grimy
plastic cases. Instead, your customers will browse the complete
catalogs of the record labels on computers and create their own
collections. While your business will change operationally, you'll
still be selling music but I would emphasize, without a nightmare of
retail inventory and you will most likely be in the position to offer
your customer something they cannot get at the big boxes that are
currently beating you about the face and head, and that's a pleasant
experience.
----
Most of the feedback I got was, unsurprisingly, incredulous. Most of
the indie storeowners were convinced that their customers loved
digging through dirty bins and wanted to search through thousands of
titles to find the one they would actually buy. The idea that seemed
to repulse them most was turning their store into a social center, a
coffee shop of sorts.
Of course, this didn't happen for a number of reasons. The biggest
was, the labels never allowed their product to be sold through
licensed local retailers. While it's arguable that my idea is still
a viable model (some music buyers do like to socialize when they buy)
I doubt it will happen. The indie retailers, in their own way, are
just as stubborn and short sighted as the labels. Most of them still
resent the idea that vinyl is gone. Most indie retailers don't
respect their customers and don't bother to take the time to turn
them onto new music.
Which is sad because the idea, I think, would actually offer a decent
value to the consumer. Shortly after I wrote this Hear Music opened
its first store in Berkeley, California. Curiously enough, it was
structured, somewhat along the lines I mentioned in the report. And
somewhat more curiously, Starbucks Coffee bought the chain in 1999.
Though Starbucks has not fully developed Hear along those lines they
have incorporated many of the nuances of my original report into the
concept and offer custom burned CDs as well coffee.
Before I was born music stores were vastly different places than the
ones I worked in during my youth. In the fifties it wasn't unusual
for the appliance/TV store sell music or the local musical instrument
to sell records and sheet music. Listening booths where customers
could preview their selections were more common than not. The music
retail industry is constantly changing. It's the retailers who
cannot adapt with their customers that get left behind.
- posted by Ice Weasel
Jesse "Doc" Wendel: "The Day The Music Died"
Buddy Holly good. RIAA awful.
Thanks to Doc Wendel for this great and IMPORTANT reminder why the RIAA blows - THANKS DOC!
THE RIAA KILLS INTERNET MUSIC WEBCASTS
THE DAY THE MUSIC DIED or
The Sony Betamax Case -- Part 2 (The Bad Guys Win)
By Daniel McSwain
The Copyright Royalty Board (CRB) has announced its decision on Internet radio royalty rates, rejecting all of the arguments made by Webcasters and instead adopting the "per play" rate proposal put forth by SoundExchange(a digital music fee collection body created by the RIAA).
RAIN has learned the rates that the Board has decided on, effective retroactively through the beginning of 2006. They are as follows:
2006
$.0008 per performance
2007
$.0011 per performance
2008
$.0014 per performance
2009
$.0018 per performance
2010
$.0019 per performance
A "performance" is defined as the streaming of one song to one listener; thus a station that has an average audience of 500 listeners racks up 500 "performances" for each song it plays.
The minimum fee is $500 per channel per year. There is no clear definition of what a 'channel' is for services that make up individualized playlists for listeners.
For noncommercial webcasters, the fee will be $500 per channel, for up to 159,140 ATH (aggregate tuning hours) per month. They would pay the commercial rate for all transmissions above that number.
Participants are granted a 15 day period wherein they have the opportunity to ask the CRB for a re-hearing.
Within 60 days of the final determination, the decision is supposed to be published in the Federal Register, along with any technical corrections that the Board may wish to make.
Within 30 days of publication in the Federal Register, it can be appealed (but only by the participants) to the U.S. Court of Appeals of the District of Columbia.
...
...
Because a typical Internet radio station plays about 16 songs an hour, that's a royalty obligation in 2006 of about 1.28 cents per listener-hour.
In 2006, a well-run Internet radio station might have been able to sell two radio spots an hour at a $3 net CPM (cost-per-thousand), which would add up to .6 cents per listener-hour.
Even adding in ancillary revenues from occasional video gateway ads, banner ads on the website, and so forth, total revenues per listener-hour would only be in the 1.0 to 1.2 cents per listener-hour range.
That math suggests that the royalty rate decision — for the performance alone, not even including composers' royalties! — is in the in the ballpark of 100% or more of total revenues . —KH
...
HOW TO TAKE ACTION
1. Sign this online petition and open letter to the US Congress.
2. Send an email to your members of Congress. You can use our suggested text, or write your own.
3. Print out the email (you'll get a copy) and mail it to your Congresspeople. Follow up with a phone call. You can look up their addresses and phone numbers here .
4. Write a letter to the editor of your favorite magazines and newspapers. If you know someone in the media, let them know what's going on. Have them read my post below, if you like.
5. Don't panic. Together we can save the medium that we all love. We have the passion to make it happen!
http://www2.blogger.com/img/gl.link.gif
The View From Paradise
I'm Bill Goldsmith, and my wife Rebecca and I have spent the last seven years of our lives pouring our hearts, minds, and financial resources into . We are now faced with the very real possibility that all of our efforts will have been in vain, and that the thousands of people who are devoted listeners to our station will have it snatched out of their lives.
I have been in love with radio all of my life, and spent 30-odd years dealing with the conflict between my vision of radio as an art form and my FM-station employers' vision of radio as a conduit for advertising. I have watched the medium that I love turn from an essential part of the process of connecting those who love making music with those whose lives are touched by it into a mindless background hum of advertising and disposable musical sludge.
With the advent of the Internet, we were finally able to bring to life the radio station I had always wanted to work for (and listen to): commercial-free, passionate, and embracing a wide universe of musical treasures, from the classic rock artists I grew up with to the latest indie discoveries, with a liberal sprinkling of world music, electronica, jazz, even classical. We have slowly built up a loyal audience and have been able to support ourselves while living our dream.
An Exciting - But Fragile - New Era for Radio
The Internet has changed radio in a profound way. Instead of a business that required investments so huge (millions of dollars for even a small-market FM station) that a programming focus on the lowest common denominator and an extreme aversion to risk or experimentation was an unavoidable consequence, a radio station with a global reach was now within the grasp of anyone with the talent and determination to make it happen.
Every day we hear from listeners who are profoundly touched by our efforts - by the music we play, by the way we assemble the songs into meaningful sequences that are more than the sum of their parts, by our passion for what we are doing, and our commitment to never contaminating the music with advertising. And our station is but one of many who have attracted that kind of passionate following, and provided that kind of outlet for radio artists like myself.
The Internet's paradigm-shifting gift to radio programmers and music lovers - at least those in the US - is now in danger of being taken away by the misguided actions of the US Copyright Board. The performance royalty rates released by the Copyright Board on March 1, 2007 are not just extreme, not just burdensome. They are a death sentence for all US-based independent webcasters like Radio Paradise, SOMA-FM, Digitally Imported, and many others.
The facts and figures of the new rates are detailed in Kurt Hanson's newsletter for 3/2/07. Kurt's analysis of the financial impact of the new rates is entirely accurate, and chilling.
The Artificial Analog vs. Digital Divide
There has been much discussion about how unfair these rates are, but our listeners find one fact particularly appalling: while Internet stations like ours are being told they must pay royalty fees that exceed their income, sometimes by several times over, FM stations - including those owned by media conglomerates like Clear Channel - pay nothing at all!
Yes, both FM stations and Internet stations pay royalties to songwriters and/or music publishers. But the royalties in question are owed to the owners of performance copyrights, which means, in most cases, record companies - and to them, FM stations pay nothing at all.
How is it possible for such a massive disparity to exist? For the answer to that we need to go back to the 1990s, when music industry lobbyists persuaded Congress to include wording in two pieces of legislation (the Digital Performance Right in Sound Recordings Act of 1995 and the Digital Millennium Copyright Act of 1998) that drew a sharp division between analog and digital broadcasts. Their reasoning was that a digital radio transmission was not a radio broadcast at all, but a sequence of perfect digital copies of music performances provided to the user, who could then copy them rather than paying to own a CD.
This is a profoundly flawed piece of reasoning, but members of Congress (who at that time had no idea how this whole digital thing worked) accepted it at face value, and agreed that it was only fair that digital broadcasts be subject to additional copyright fees, to be determined by an impartial (in theory…) ruling by the Copyright Office.
Let's Get Real About This
Let's reassess that reasoning in the light of 21st-century reality. Is there, in truth, a fundamental difference in the experience of an online listener to Radio Paradise and someone who was listening to identical programming on an FM station? Every one of our listeners - indeed, anyone who has ever clicked on a webcast as background music while working - knows the answer to that question. No! There is no difference whatsoever. Radio is radio, whether it comes in digital or analog form.
A Grave Disservice to The Public
Crippling an exciting, groundbreaking industry like Internet radio is certainly not in the best interests of the public, nor that of musical artists, and not even - if history is any judge - of the music industry itself. Just as they were unable to see how the advent of home music taping actually spurred the sale of LPs and CDs, they are unable to tell exactly what impact Internet radio and other forms of digital media will have on the future of their industry - and to behave as if they do know, and for Congress to go along with them, is a grave error, and public disservice, that needs to be recognized and corrected.
So, if we are building a business - even a non-commercial business like Radio Paradise - by the use of copyrighted material, isn't it fair that we pay for its use? Perhaps it is. But the fact remains that what we are doing does not differ in any substantive way from what a company like Clear Channel is doing, and to move forward under the fiction that such a distinction exists is neither fair nor rational.
Perhaps the most equitable solution is for all broadcasters - analog or digital, terrestrial, satellite, or Internet - to pay such royalties equally, just as they all pay more or less equally for the use of music compositions. This is the situation in many other places in the world, including most of Europe. The fact that the US broadcasting lobby has successfully out-spent and out-maneuvered the music industry on this issue should not be "balanced" by Internet radio royalty rates so high that they cripple that entire industry.
That kind of reform will take some time - time that people like my wife and myself just don't have. We are hoping that we can, along with a small group of other independent webcasters, negotiate a separate settlement with the RIAA, similar to the one we negotiated in 2002. That agreement allowed us to operate by paying a royalty equal to 10% - 12% of our gross income in performance royalties. That has been enough of a burden for a struggling "mom & pop" operation like ours, but it has allowed us to survive since that point. However, that agreement has expired, and we are now liable for royalties, retroactive to the beginning of 2006, that are equal to approximately 125% of our income.
What's The Solution
The truly fair solution is a moratorium on the collection of any fees and the imposition of any penalties until Congress has had the opportunity to revisit the decisions they made a decade ago, and see if there is not in truth a profound wrong that deserves to be righted.
- posted by Jesse "Doc" Wendel
Time to wake up
(AFP/Valery Hache)
Record Labels Contemplate Unrestricted Digital Music
By VICTORIA SHANNON
Published: January 23, 2007CANNES, France, Jan. 22 — As even digital music revenue growth falters because of rampant file-sharing by consumers, the major record labels are moving closer to releasing music on the Internet with no copying restrictions — a step they once vowed never to take.
Executives of several technology companies meeting here at Midem, the annual global trade fair for the music industry, said over the weekend that at least one of the four major record companies could move toward the sale of unrestricted digital files in the MP3 format within months.
Most independent record labels already sell tracks digitally compressed in the MP3 format, which can be downloaded, e-mailed or copied to computers, cellphones, portable music players and compact discs without limit.
The independents see providing songs in MP3 partly as a way of generating publicity that could lead to future sales.
For the major recording companies, however, selling in the MP3 format would be a capitulation to the power of the Internet, which has destroyed their control over the worldwide distribution of music.
Until last year, the industry was counting on online purchases of music, led by Apple’s iTunes music store, to make up the difference.
But digital sales in 2006, while 80 percent ahead of the year before, grew slower than in 2005 and did not compensate for the decline in physical sales, according to an industry report released in London last week.
Even so, the move to MP3s is not inevitable, some insiders warn.
Publicly, music company executives say their systems for limiting copies are a way to fairly compensate artists and other copyright holders who contribute to the creation of music.
But privately, there are signs of a new appreciation in the industry for unrestricted copies, which could be sold as singles or through subscription services or made freely available on Internet sites that support advertising.
Here we go again
Cracking Down on Mixtape CDs
By JEFF LEEDS
Published: January 22, 2007
Not long before Christmas, Jeff Baker, the chief of police of Morrow, Ga., a small town just south of Atlanta, and one of his officers were walking through a local shopping mall when they happened to pass a kiosk hawking rap music CDs. One in particular caught their attention.
The CD was “Tha Streets Iz Watchin,” with songs performed by the rapper Young Jeezy and, as Chief Baker recalled, it did not carry the name or address of the owner of the music copyrights, as Georgia law requires. Rather than arrest the kiosk vendor immediately, Chief Baker said, “We’d rather go after the source of the material. And at that point we had no idea what the source was.”
Any rap music aficionado would; the creator of the album is DJ Drama, whose real name is Tyree Simmons, arguably the nation’s most prominent producer of mixtapes, the name given to popular but largely unlicensed CDs stocked with yet-to-be released rap hits and free-style rhymes.
And many more people now know: last week, local authorities, working with the recording industry’s trade association, stunned fans and music executives alike by raiding DJ Drama’s studio in Atlanta and arresting him and a fellow D.J., Don Cannon, on racketeering charges. Investigators seized more than 81,000 allegedly pirated CDs and say the pair were producing unlicensed recordings and selling them without permission.
The raid sparked an outcry among many rap fans. But it also threatens to throw into public view the recording industry’s awkward relationship with mixtapes, long an integral element of rap culture and now commonly for sale on street corners, Web sites, many independent record shops and occasionally big chains.
Even as industry-financed antipiracy squads hunt for unauthorized recordings, senior executives at the major record labels privately say that they have courted — and often paid — top D.J.’s to create and distribute mixtapes featuring the labels’ rappers as part of efforts to generate buzz.
The record industry seems intent on alienating their audience