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#tbt - how technology will kill the music biz

In 94 iTunes hadn't been dreamed of, Spotify was barely a figment of our imaginations and mp3 players an unrealistic dream, yet here at i-D we were dreaming about being freed by the Internet beaming music directly into our living rooms, and how free downloads and information terrorists were going to put all the record companies out of business. Take a trip down memory lane to i-D No.129, The Rock'N'Roll Issue.

It’s late and the sodium flares are burning yellow through your apartment window. The radiation is fairly low-level tonight. You throw your coat down and slump into an armchair. You grab the remote and call up some music on the terminal. After a blipvert for Marlboro Blunts, the menu flashes up, you pick the New Releases (Ambient Jungle) channel, and fix yourself some tea. The first track is awful. You press the skip option and something altogether more pleasant begins. You press for info and the artist and title appears on the screen, along with options for further information. You decide to keep the track, One For The Ladies by Horizontal. You press the save option, enter your PIN and it’s transferred to your hard disk, along with all the relevant background (some text and video) on the band, should you get curious. 

The future has no record shops and no record companies; the division between packaged music and broadcasting is blurred completely; fibre-optic links bring it all straight to your home. And music is so easily available, so easy to reproduce and distribute, that it is free.

Compact discs, cassette tapes and vinyl are not music. They are just objects which contain it. Music, in the digital age, is simply information: the ones and noughts of computer code. And as the channels of communication multiply, as the ‘Information Superhighway’ spreads its fingers around the globe, there will be a massive proliferation of information. Music, along with graphics, video, phone calls, text and computer programmes – all reduced to electronic pulses – will be whizzing around the planet, across the world’s phone systems, cable TV lines and satellite links. This enormous growth of the Network will render information increasingly mobile, increasingly accessible, and because digital information costs nothing to reproduce, increasingly hard to own. These facts mean drastic changes; not least in the way we consume music.

The entertainment giants have their fingers crossed for a future in which online delivery will multiply consumer choice and increase their profits. Other people, notably musicians, think that as more and more people get online, music will be so easy to distribute that the record companies will be put out of business.

 

what is the information superhighway?

Think of the information which enters your home: TV channels, radio stations, computer games, videos, phone calls, mails (bills and bank statements), newspapers… By the end of the century all this information (and masses more) could arrive down a single multi-channel, multi-purpose connection. It might be beamed by satellite, or carried along fibre-optic cables. Once in your home it would be processed by a powerful computer with hi-fi stereo sound, a TV screen, a keyboard, a phone handset and a huge digital memory. The information this would give you access to might include 500 channels of interactive TV, a few hundred channels of audio, info-links to the world’s computers and their memory banks, and phone connections to real people. This is the Information Superhighway.

This vision is already causing fierce commercial activity as the world’s corporations attempt to secure maximum control for the future. Entertainment giants like Time Warner and Sony know that their power depends on owning the means to distribution. And as the world moves away from purchasing information in containers (CDs, magazines, videotapes, games cartridges) and instead receives it online (ie down the links of the Superhighway), these companies are worried that unless they act fast, technology might put them out of business.

To prevent this, they’re doing deals with phone networks and buying cable TV companies in a desperate effort to cling on to the means of distributing their products. America’s largest cable TV company TCI, has teamed up with part of the phone giant AT&T; Time Warner has done a deal with Sony and Digital Cable Radio Associates; and, though President Clinton has made vague assertions that the superhighway should be funded by government and open to all, it is unlikely that the corporate world will allow such a democratic vision.

In Britain, where the cable TV industry is still in its infancy thanks BSkyB, BT is already conducting field tests of online on-demand video, and, along with Mercury, laying the high bandwidth cables which will allow the superhighway to be built.

 

the record store of the future

The corporate music business has accepted the inevitability of online distribution of music. However they don’t want it delivered only to the home, they want to send it somewhere they can still control and market it; the record store. MCA chairman, Al Teller, expresses their fear of losing control: “if we sacrifice the retail environment to technology we lose a vital arena in which to expose and promote new product.”

Teller and his peers envision the record shop of the future as a place where computer terminals will deliver an unlimited selection of recordings. You will browse through a menu of all the records ever made, make your choice, and wait a few seconds while it is downloaded from the retailer’s huge memory bank hundreds of miles away and pressed into a CD for you to take home. High quality colour laser printers will make you some sleeve artwork, and the product need be no different to that which you buy today. From the Virgin Megastore in London’s Oxford Street to Langfords in Market Rasen, every shop would stocks of every record and no title would ever sell out.

You’re happy because your choice as a customer is increased massively. The artists are happy because they can reach the right audience much more precisely. And the entertainment companies are happy because they have no warehousing cost, no unpurchased CDs and their costs are cut to almost zero.

 

does anyone need record companies?

Of course, the reason the record companies so keen on this scenario is that it would increase their profits by untold amounts (it’s doubtful they would ever pass distribution savings onto the consumer; remember the move from vinyl to CDs: a new cheaper format sold at new higher prices). However, think back to our digitally stocked record store. Basically, it’s a terminal receiving information (music) from a central memory bank. But you’ll already have a terminal in your home – why should you allow big business to muscle in as the middle man? Teller’s concept of the future record store is really just a atoll booth interrupting the flow of musical traffic along the superhighway. Why not drive it straight in through your door? But if you can live without the actual CD object (which only takes up space and gets scratched or stolen), why don’t you just download an album-load of music into your personal hard disk memory bank?

The only thing delaying the online record store is dispute over who should develop it. Last May, Blockbuster Video made a deal with IBM and announced that it would soon be constructing in store CD-pressing equipment with online delivery (the customer would have to wait about six minutes to receive a CD). The response of the record companies, unwilling to see their distribution monopoly slip through their fingers, was predictable. “Why would we empower somebody else to take over our distribution business?” asked Teller, as he joined other in obstructing Blockbuster’s plans, and announcing their own. “I’d prefer that our finger is the one on the button.”

 

The ultimate home entertainment package

But will anyone’s finger stay on the button very long? Your home will already be receiving an abundance of CD-quality digital sound from specialised broadcast transmissions (the 70s funk channel, the Belgian techno channel, the new rap releases channel, etc.) Why would you want to pay £20 for an extra bit of packaging when the essence of the product, the music, the information, is available to you at home, at the same quality, for next to nothing?

This is where things start to get tricky for the big entertainment corporations. Remember the paranoia the record companies have about home taping? That’s nothing. Once technology advances sufficiently (with better data compression techniques, high band-width transmission lines, larger, faster and cheaper hardware) it will be incredibly easy for you and I to make perfect digital copies of CDs from broadcast media, and to offer further copies to all our friends at the cost of a phone call. Digital information is so liquid in this respect that it is hard to imagine how anyone, even the most corporations, could control its flow. All it would take would be for information terrorists to set up an ownerless computer bulletin board and fill it with music, and the record companies power and profits would be undermined.

And music is already part of the digital torrent rushing around the net. At the Univeristy of Santa Monica, Robert Lord and Jeff Patterson, both computer science students, have created something they call the Internet Underground Music Archive. This allows you to choose from a selection of music and download a particular song onto your hard disk. Your chosen track is transferred from their IUMA computer down a phoneline and into your home computer. With the right hardware (a soundcard) you can then output this to a stereo system, a cassette deck or any other form of recording device. At present the technology is slow and user unfriendly, but the partners see their system as the prototype for the music distribution method of the future. “By 2000, anyone with a soundcard should be able to listen to a complete online music library,” they suggest. “We see the music industry really losing significance.” Needles to say, the record companies involved have already mobilised their lawyers.

 

distribute records from your bedroom

No-one is more keen on the implications of the superhighway than musicians themselves. Matt Black of Coldcut, who now runs Hex, a multimedia company exploring the possibilities of new technologies, considers the way musicians will work in the future: “I very much look forward to a scenario in which I record my album, make my video, stick it up on a bulletin board, and then everyone’s got access to it. Say you’re a punter, you see the adverts up on the net, you want to check x’s new album. You go there, you could maybe listen to some samples of it for free. And if you like what you hear, you pay a fee and it’s downloaded directly to your server, i.e. to your computer, which is connected to your hi-fi.” The implications of this, he believes, are more than just technological. “It would be a direct transaction between you, the consumer, and me, the producer. Fuck all the big companies in between.”

“As artists, we’re not going to need record companies in ten of 15 years time,” argues Thomas Dolby in Music Technology, envisioning a similar distribution method. “What exactly is the record company’s contribution, other than being a bank stupid enough to loan money to musicians?”

The entertainment corporations are aware of these possibilities, and deals are hurriedly being struck to secure their continued supremacy. The incentive of protecting their commercial interests is strong, but corporate power may find itself a hammer trying to stem a waterfall. While their money might be able to buy the major routes of the information superhighway, there seems little likelihood that its back road could be policed effectively. It may be that they could never control the boundless flow of information, and in that case might concentrate instead on marketing their product in ever more enticing interactive packages; leaving the music free to the pirates. Whether or not they can respond quickly enough to retain their position as information gatekeepers remains to be seen.

 

getting paid

What is certain, is that the impending revolution in technology will have a considerable impact on the application and enforcement of copyright. And big business, with its armies of lawyers, is already arming itself with the battering ram of litigation. After the confusion over sampling, most people, artists and executive alike, agree that some kind of universal performance royalty will be necessary, and this is what the corporate legal effort is currently aimed at achieving. Because online distribution is tantamount to broadcast, and because it will be paid per use, receiving a tiny payment every time their work is played.

But will music one day be free? This is not as unrealistic as it might seem. We already have free music whenever we tune in to a broadcast medium paid for by advertising, and this is unlikely to change. Another likelihood is that, faced with the impossible task of preventing piracy, the music industry admits defeat and uses music – singles and albums – as a promotional tool for other ways of generating cash. Major labels have long treated singles this way: as a loss-making way of promoting album sales. Major musicians might be on a salary, computed in a similar way to broadcast personalities. Other artists will produce their work for free, taking a cue from computer programmes, knowing that users will eventually pay money for a more powerful version), as a promotion for profit making activities; t-shirts, gigs, books.

Whatever happens, there will have to be a fundamental change in economic thinking. For thousands of years, we have valued things according to their scarcity. Once we leave the realm of material objects and start dealing in digital information, we are buying and selling something that can be reproduced infinitely and perfectly for nothing. And something whose value actually increases the more abundant it is. As Matt Black points out: “Making a living as a musician has always been impossible anyway. So you might as well settle for getting as many people as possible into what you’re doing. And the most efficient way to leave your work behind is to let it free. One’s only immortality is through your ideas.

The lights dim for a second. The monitor screen flashes with some hazy interference: a distant power outage somewhere on the Net. The gunfire is surprisingly sporadic tonight, but it’s still early; at least an hour before curfew. Your screen snows over again. Damn! Information terrorists. It’s the fourth time in a month they’ve broken the Sony defences. You run for the mute button but it’s too late, they’ve already jammed the interface. You’re figuring out where you can go to avoid the attack, but you can’t think of anyone who’s not online. And then it starts. The volume creeps up and the ominous strains of the ‘Nineties Nostalgia Channel’ start screaming from every flat on the block. It’s Blur’s Boys and Girls. They’ll repeat it until the Sony cops mop up the attack. The only alternative is a night offline. You know you’ll miss tonight’s Celebrity Embarrassment, and Elaine was going to call, but you figure it’s worth it. Hands over your ears, you reach for the master socket…