How The Record Labels Are Only Ten Years Behind In Their Thinking About Business Models

Culture

from the eventually-they'll-get-there dept

The NY Times Magazine is running an interesting profile of Rick Rubin, the well-known producer who had tremendous success over the past twenty years producing all sorts of successful musical acts — from the Beastie Boys to Slayer to Johnny Cash — and who took over as the co-head of Columbia Records back in May. While the story itself is interesting and focused on some of Rubin’s peculiarities and his key focus on finding and producing good music — there are a few other interesting tidbits that come out. The first is how Rubin was completely pissed off at Columbia prior to joining the company because the Sony rootkit debacle hit just as a Neil Diamond album Rubin produced had come out to great fanfare. It was apparently number 4 on the charts — the highest ever for a Diamond opening. Except, Columbia is a subsidiary of Sony BMG and so the Neil Diamond album was included among those that had the rootkit — and the furor over that got it pulled from the shelves, and that basically killed its commercial prospects. So, at least we know that Rubin won’t be a fan of such things.

However, the article suggests that Rubin and others in the industry are much more interested in setting up some sort of universal subscription system that would allow any subscribers access to any music on any platform. What’s most amusing about this is that this is exactly the proposal the EFF suggested many, many years ago, which recording industry executives insisted would never work. What’s even funnier is they might be right now, after managing to screw up all sorts of goodwill from customers. Back when the EFF suggested it, it probably still could have worked. However, Rubin is exactly right on where the industry is headed if it doesn’t figure out these new business models quickly: “The future technology companies will either wait for the record companies to smarten up, or they’ll let them sink until they can buy them for 10 cents on the dollar and own the whole thing.” That’s why I’ve always figured that things would work out in the end. If the RIAA members keep shooting themselves in their collective feet, then the problem will eventually take care of itself. Of course, the labels could avoid a lot of the problems if they learned how to actually embrace certain aspects of file sharing. It’s not clear that Rubin (or anyone else in the industry) has gone that far yet. They’re just still working through the ancient EFF plan they derided when it first came out. In fact, one of Rubin’s other questionable ideas is setting up a fake word-of-mouth marketing organization, where Columbia has hired a bunch of young adults to promote their music online on blogs and in forums and such. Hasn’t anyone explained to them that word-of-mouth is about people who legitimately enjoy the music — not those who are paid to promote it? File sharing was legitimate word-of-mouth marketing. Hiring young adults to spam forums is not.

Filed Under: business model, columbia, music, riaa, rootkits
Companies: columbia records, riaa, sony