Re: Paying for downloads (was:Re: <OFF-TOPIC>) (fwd)

[Andre LaFosse <altruist@earthlink.net>]

James Pearce wrote:

> You wanna sell
> a product without actually having a tangible product for sale

Where's the tangible product when you go to a concert?  What do you have
that's tangible when you walk out of the venue (or for that matter, even
while you're in the venue?)  How tangible is the sound that comes out of
a commercially-produced, commercially bought-and-sold CD, and how is
that actual sound any more tangible than the sound coming out of a
downloaded soundfile?

That is what we're dealing with, after all -- sound.  That's why the
jewel box, CD, liner notes, packaging, et. al is there in the first
place.  

> seems kinda
> lame and a way to avoid "costs" and increase your "income" 

It's *absolutely* a way to avoid costs and increase income -- no need
for the quotation marks around those words.  

Look at it this way: in a standard major-label deal, an artist recieves
something less than $1.00 for every CD they sell.  (This is assuming
they actually manage to pay back the several-hundred-thousand dollar
debt they owe their record label for the recording of their album, which
is payed back via artist royalties).  If you're an artist on a label,
getting less than a buck for a CD that will probably be sold for
somewhere around $16.99 isn't a great deal.  And you'll only be looking
at getting that buck if you're one of the 3% of all artists whose album
sells more than *700* copies.

Maybe you're putting out a CD independently on your own.  You're still
looking at an investment of (at the very least) about $1,000 to get CDs
printed up, plus costs for artwork, printing, packaging, shipping and
handling.  You'll stand a better chance of recouping your investment if
you're making all the money off of sales, but it's still a considerable
investment to get the music in "hard copy" format.

On the other hand, let's say you're offering your music for sale via
download.  There'll be a small percentage taken out by the credit card
provider, and there'll be some sort of fee for your e-commerce provider
(for a few songs, probably somewhere in the neighborhood of $20-$30 a
month).  That's a considerably better deal for the artist.  

> without providing a
> interesting package that people can use and play outside of their 
>"computer
> rooms". You see, most ppl don't have RIO, and most ppl don't have 
>cd-r's. 

Fifteen years ago most people didn't have CD players or personal
computers, either.  Six years ago most people didn't have a web
browser.  Two years ago most people didn't have a DVD player.  These
things change.  And one of the main things that facilitates these
changes is products (like music downloads) being made available.  The
more demand and availability there is for a niche product, the more
likely that niche is to be filled.

> So
> what'r they gonna do with some internet stream if they wanna listen to 
>your
> music in the car?

You can already buy portable RIO-type devices to play in your car.  As
more people get online and the availability of portable players
increases (and the prices drop), this will become more and more
commonplace.

Besides, let's say you're a major record label, owned by a large
corporation.  If you were looking at paid advertising for streaming
Internet audio on demand, wouldn't it be in your interest to prod other
divisions of your corporate umbrella into facilitating the technology,
and prod the customer into purchasing it?  
 
> I dunno, my two cents, information is pretty free in my world,

Is this the same world inhabited by the phone company you pay to get
online, the ISP that charges you for Internet access, the banner ads
that show up on countless Web sites, the corporations that own ISPs and
web sites, and the bandwidth availability that has to be paid for by
providers and users alike?  

What about the world in which artists have a copyright on their work,
and distributing copywritten material without consent (even if it's an
online form) is against the law (to say nothing of the ethical issue of
cheating the artist out of the right to profit from their work?)

> and an mp3 is
> just a flat-file with information waiting to be decoded by Winamp.

A CD is just a storage system for one's and zero's waiting to be decoded
by a laser.  And a cassette tape is just a series of magnetic particles
waiting to be decoded by a playback head.

> And in my opinion "online-distribution" isn't real work. Ton's of fools 
>do it,
> and some fools do it better than others. But the fact is they do it 
>because of
> the low overhead it requires, the manual labor is gone, so the idea that 
>this
> "flat-file" is an actual product is a larf to me.

Music is sound.  Sound is a fundamentally "intangible" thing.  But the
sound waves that come out of a Winamp-decoded flat-file is no more or
less "tangible" than the ones coming out of a CD player or turntable. 
Yes, the sound quality is not quite up to par at the present moment. 
That's already changing at an alarming rate.  Yes, not that many people
own portable sound file players or CD-R burners.  That too is changing.  

And yes, eliminating the costs and logistics of manufacturing a physical
product has some very attractive elements for a prospective label or
artist.  By offering music for download, you're eliminating the
following chain of circumstances:

-- Pressing up the CDs,

-- trying to get a distributor to take on that product,

-- selling that product to the distributor

-- trying to get the distributor to sell the product to an actual retail
outlet,

-- getting the retail outlet to actually sell the item,

-- trying to get the distributor to pay you for product sold to a retail
outlet, 

-- hoping that the distributor won't wind up billing you for CDs which
might be returned to the distributor by the retail outlet after they've
been sitting on the shelf collecting dust for several months

-- making, in the best-case scenario, a few dollars off of a product
with a current average in-store retail price that's scraping at the edge
of $20.

Personally, the idea of eliminating all of the middle-men and logistical
costs from this equation is damned exciting to me.  Sorry if it's
nothing more than a larf (to use your term) to you.  Hopefully you won't
look too unkindly upon people who are interested in empowering
themselves and thinking in terms of where things are going instead of
where they are right now.

--Andre