Music Exec: 'Music 1.0 Is Dead.'

Five hundred top members of the music business gathered today in New York to hear that "music 1.0 is dead." Ted Cohen, a former EMI exec who used the phrase, opened the Digital Music Forum East by pleading with the industry to be wildly creative with new business models but not to "be desperate" during this transitional period. But what is music transitioning to? No one seemed quite sure, except to say that it won't look much like the music business of the last several decades.

DRM on purchased music is dead

A utility pricing model or flat-rate fee for music might be the way to go

Ad-supported streaming music sites like iMeem are legitimate players

Indie music accounts for upwards of 30 percent of music sales

Napster isn't losing $70 million per quarter (and is breaking even)

The music business is a bastion of creativity and experimentation

Only a few years ago, none of those statements would have been true, but perhaps none is more striking than the last. Panelists from every sector of the digital media marketplace were in agreement that the major labels, under the pressure of eroding profits, have been forced to become experimental in their business dealings and to do deals that would have been deemed too risky only months before.

Just within the last year, we've seen an array of experiments that include ad-supported streaming, "album cards" from labels like Sony BMG, and allowing Amazon to offer MP3s from all four majors. Some labels even allow user-generated content to make use of their music in return for a revenue share from sites like YouTube—unthinkable a few years ago to a business wedded to control over its music and marketing. YouTube's Glenn Otis Brown says that the labels now have less of a "standoff mentality" and are ready to deal.

That innovation has been paying off. Interscope now rakes in 40 percent of its total revenues from digital sales, while Sony BMG makes 30 percent (in the US), but this hasn't been nearly enough to offset the loss in revenue from plummeting CD sales. While the majors once held all the cards when it came to licensing music (and they used their power to negotiate revenue splits on the order of 85/15), they aren't quite so powerful any more. In fact, several audience members and panelists even questioned whether major music labels brought much to the table besides their back catalogs.

Read more at Arstechnica.com.

Comments

[AimlessAmoeba]

Aw. Not Music 1.0...

What an ignorant concept.

[F@ Man]

good news.
yes.

[EvilWeevil]

Music 1.0 is dead! Long live...music? Wtf is the point of that title its not as if 'music' is gonna disappear.

Would have been more appropriate to put: "K, guys the labels finally realise they need to change or they will cease to make the profits we've become accustomed to."

Might be cynical but it seems to be merely a soundbite that hides the concerns for profits that these labels are currently experienceing.

[anodetodrivebys]

labels now have less of a "standoff mentality" and are ready to deal.

very important concept

[RockFreak000]

This will open the door for the RIAA to achieve world domination
daymn

[Jondy]

seems to be great news for artists.

[Jackolas]

As a true musician they can coin as many phrases as they like, but I don't care.

[Bananapatata]

RockFreak000 :
This will open the door for the RIAA to achieve world domination
daymn

explain.

Clever Ted Cohen. What's next, music 2.0?

[olif8]

Jackolas wrote:

As a true musician they can coin as many phrases as they like, but I don't care.

How ignorant. I'm all for change in every aspect of life, and this can only be good news, and it opens the door to so many other possibilites. It's quite exciting to read about.

However, "Music 1.0" is a lame, outdated, and uncreative phrase in all honesty.

[cedaguol]

all this digital things are gonna **** up music and its business...

[Notoriousdoc]

Music is only a ****ing business if you're someone like 50 cent, Avril Lavigne or Nickelback.

[Vornik]

Right... because music has only existed for the past "several decades"...

[Royyor]

Whatever they do, music will always be available for free as long as the internet is around... maybe they will con more people into thinking that isn't true?

[shredder232002]

correction:

*Music Business 1.0 is dead

[wasp2020]

Vornik wrote:

Right... because music has only existed for the past "several decades"...

No, the music business has. That's what the whole article is about. What, did you think the guy is saying "Guys, this whole 'music' thing those artist guys are doing is outdated, let's kick it up a notch!". Did you people even read the article?

Hgonestly, why are people misunderstanding this? He simply used "Music 1.0" in stead of "Music Business" - basically, he's saying, the music business is long due for a major overhaul (ie. "Music 2.0"). This is absolutely and undoubtedly a good thing for all parties concerned, and maybe if people would actually read the article for a second, they would realize that.

[emr_steelmech]

shredder232002 wrote:

correction:

*Music Business 1.0 is dead

yep.

[kevinm4435]

you mean we've been working at this thing for the last ten thousand years and we're still only at 1.0? balls.

[JoeyDengler]

I agree with Cedaguol that all this digital shit is going to mess music and the business up - yeah music is about creativity and shouldnt be about making money but why should musicians give their work away? You dont go into a shop and get food for free so why should you get music for free? Musicians have to earn a living too and eventually if it all turns to digital sales then things like concert prices will go up because thats the way musicians will get paid.
People rely on technology too much - the CD is the best format music could be on. If all we could do is have our music on MP3s then what do you do if you go to a party and want to listen to music? You all take your MP3s and dance listening to your own songs???
Music released on MP3s and any other way besides CDs and Vinyls are just so stupid - what happens if you downloaded an album and paid for it but didnt get chance to put it on your MP3 and your computer got wiped? It would be a waste of money - if any famous musicians read this and are planning to sell their music via MP3s only then you'll lose respect from me because i can understand wanting to cut out the blood sucking middlemen wanting their share but what about who want to listen to your music but dont have the technology to get it - thats pretty selfish really.

[deafening]

shredder232002 wrote:

correction:

*Music Business 1.0 is dead

and thank heavens

[travislausch]

The music business is a bastion of creativity and experimentation

That was the funniest thing I've read all week.

[Psychopathology]

OMFG itz offfizials!!!111!11 This is retarded.

[priestfan76]

I'm sure that somebody will think of a way to have the artist paid.Who knows, maybe it'll be like a business and everyone in a certain circle will get paid X amount?Not saying that will or should happen, but It's a possibility i guess right?

[Mojo89]

travislausch wrote:

The music business is a bastion of creativity and experimentation

That was the funniest thing I've read all week.

+100000

[Charlie4]

Screw record labels ! They don't give a damn about the artists, all they care about is the money. Finally they get what they deserve - their monopoly is collapsing and they cannot stop world wide change. We are living in the digital age.

[fastlanestoner]

good bands/music are always going to be around. **** the corporate jackknobs

[surethingmrvai]

wasp2020 wrote:

Vornik wrote:

Right... because music has only existed for the past "several decades"...

No, the music business has. That's what the whole article is about. What, did you think the guy is saying "Guys, this whole 'music' thing those artist guys are doing is outdated, let's kick it up a notch!". Did you people even read the article?

Hgonestly, why are people misunderstanding this? He simply used "Music 1.0" in stead of "Music Business" - basically, he's saying, the music business is long due for a major overhaul (ie. "Music 2.0"). This is absolutely and undoubtedly a good thing for all parties concerned, and maybe if people would actually read the article for a second, they would realize that.

Hey why isn't anyone listening to this guy? Or is the whole '**** record labels' mentality just too strong here?

[Anjohl]

People like owning things. People like status. If you can get music for free illegally WITHOUT the packaging to prove status, then how do you enhance ownership so people feel "privaledged"? Special features won't work, so what can they do?

I don't know if iTunes can do it, you don't OWN anything. MAYBE if you got points with every iTunes purchase,m and they had a mail order for merchandise, like a shirt or a poster with enough iTunes purchases...people like owning stuff, thats the bottom line.

[The Spoon]

Music is not a software program.

[michhill8]

Good, the music industry needs to be around, no matter what people say. No Industry=No available music to the general public.

[mosh_rocker2006]

Alright...here's the deal...music is far from dead! In fact music is in more demand than it's ever been...what's dead is the Record Business. Just because CD's are screwed doesn't mean the music industry will go down.

[WishfulShredder]

Hey Vinyl Records still sell reasonably and they were considered "dead" long ago

[Hamham272]

surethingmrvai wrote:
Hey why isn't anyone listening to this guy? Or is the whole '**** record labels' mentality just too strong here?

Correct, this site seems to be filled with big headed, blind, **** the system kids.

[Doodleface]

Music 1.0?

We were hardly living music 1.0

Music 1.0 would cavemen hitting rocks together.

[TheKingisDead]

I wonder how indie labels feel about all of this. I doubt it hurts them as much. I wouldn't buy an Aerosmith cd, but I see no problem paying $12 for a CD by a band that isn't rolling in money when they're not in geriatric care.

[envoykrawkwar7]

The Spoon wrote:

Music is not a software program.

guitar pro
power tab

haha

if only right?
all of us ugers would be rich, or at least a few, mabey like 3

[RockInPeaceDime]

Hamham272 wrote:

surethingmrvai wrote:
Hey why isn't anyone listening to this guy? Or is the whole '**** record labels' mentality just too strong here?

Correct, this site seems to be filled with big headed, blind, **** the system kids.

Or people who actually look at the reality of the record companies and how they rob artists not only monetarily, but creatively. The record labels are an inferior medium...they're behind on technology and have been for years now. Instead of catch up, they want to bitch about their CEOs losing a million dollars. Now they can't buy their annual $700,000 yacht or 3rd house. Record labels are absurd, money hungry corporations that rob music for the art it is. Has nothing to do with "**** the system." It has everything to do with being tired of record companies picking up any piece of shit off the sidewalk that has a catchy tune that will make them some cash instead of producing a quality band that isn't striving to be on MTV.

[Ali-b912]

^^ yeah because bandmembers dont have giant houses or yachts or anything. and its not like recording companies distrubute and advertise bands, and help them record their music. record companies wont make money off shitty acts if people dont buy it. honestly, you think people buy soulja boy just because hes there? no its because they like him. why sell a product that wont. its based on opinion. i agree with you that most good acts dont get what they deserve but its not the recording companies fault, its the consumer. stuff that doesnt sell results in wasted money. would you rather get a profit from crap, or owe heaps for something good, but nobody else cares anyway? ****ing idiot

[Metal_Rich]

I had no idea music had version numbers.

Oh wait, it doesn't.

[Regression]

fastlanestoner wrote:

good bands/music are always going to be around. **** the corporate jackknobs

Yeah, well if it weren't for those corporate jackknobs alot of artists wouldnt be where they are today.

[I-Shot-Jr]

Ok I dont know an awful lot on the subject but as long as great artists still release their stuff and get paid fairly for it who cares about the jackasses in suits fighting over the rest?

[Lacebad]

If all we could do is have our music on MP3s then what do you do if you go to a party and want to listen to music? You all take your MP3s and dance listening to your own songs???

um..no. see we have these things called speakers. the ones on your desktop there will do fine .

[zeroyon]

People should really stop focusing on the name of the article. Read it. Discuss the points. Forget about this 1.0 thing. (and it's talking about the business, not the actual music)

I think the music business could consider broadening their scope a little and try not to force one type of music and 3 or 4 bands down your throat for a year or two at a time... only to flush them and move on to the next big thing. The next big thing has always been what drives the music industry... and for any artist to survive it, I congratulate them.

If Aerosmith (referenced above for being geriatric and still selling CD's) is still pushing CD's when they are going into the nursing home... they win. Look up who else was on the charts with them when they first hit the top ten... I bet 8 out of the other 9 artists were one-hit wonders or at least completely fell off the map within a year.

More quality bands that can hold up to the test of time keep people buying CD's. Think about your favorite bands. When they release something new, chances are you will just go buy it.. right? Because you know these guys put out 3 prior albums that were great, this next one should be great, too.

Now think about the Plain White T's. They have an article on the front page about a new album coming out... but they've already been misrepresented, over-exposed, and used up. I sincerely doubt they can survive through this new album and keep pushing sales. When the fans hear the rest of their songs and find out its nothing like that radio hit they loved so much, they won't buy it. The only way to keep this thing going is to sell out and try to reproduce their last big hit. (Think Nickelback) This is why we didn't hear another single from their last album.

So now you hear that latest jam on the radio... and you don't know what to expect. By the time you reach the age of reason, you don't just blindly purchase whatever the radio throws at you. In this age of information, you can sample the whole thing and find out its not what you expect... therefore you go to Itunes and download that one song, or get it illegally.

They ignore all of this and focus on business plans. The mentality of who gets played won't change.

[Rational_Gaze]

JoeyDengler wrote:

I agree with Cedaguol that all this digital shit is going to mess music and the business up - yeah music is about creativity and shouldnt be about making money but why should musicians give their work away? You dont go into a shop and get food for free so why should you get music for free? Musicians have to earn a living too and eventually if it all turns to digital sales then things like concert prices will go up because thats the way musicians will get paid.
People rely on technology too much - the CD is the best format music could be on. If all we could do is have our music on MP3s then what do you do if you go to a party and want to listen to music? You all take your MP3s and dance listening to your own songs???
Music released on MP3s and any other way besides CDs and Vinyls are just so stupid - what happens if you downloaded an album and paid for it but didnt get chance to put it on your MP3 and your computer got wiped? It would be a waste of money - if any famous musicians read this and are planning to sell their music via MP3s only then you'll lose respect from me because i can understand wanting to cut out the blood sucking middlemen wanting their share but what about who want to listen to your music but dont have the technology to get it - thats pretty selfish really.

CDs are already outdated mate. Like it or not technology will always be changing and making old trends obsolete. And you can play mp3 players through speakers or even PAs or Amplifiers if you hook it up properly. Its nice to have a physical product when you pay for music but its not realistic for the artist if theyre losing money making and printing the CDs. Mainstream artists have been too concerned about making a profit for too long anyway. I think artistic merit and respect for your musicianship is more important than money anyway. Noone remembers Beethoven for how stinking rich he was right? (even though he was but u get my point)

[iamspinaltap]

Hi, I'm Ted Cohen, the guy who was misquoted! What I said was that Music Industry 1.0 was over, we've been in music 2.0 for years and now on to 3.0. What I was trying to say was that the music industry is so far behind reality, it's really not funny any more. Instead of trying to sue fans, they should super-serve them, and make money while they do it. I left EMI 2 years ago because of their lack of acceptance of the digital opportunities in front of them. Life is better now.

[GNR's Fan]

iamspinaltap wrote:

Hi, I'm Ted Cohen, the guy who was misquoted! What I said was that Music Industry 1.0 was over, we've been in music 2.0 for years and now on to 3.0. What I was trying to say was that the music industry is so far behind reality, it's really not funny any more. Instead of trying to sue fans, they should super-serve them, and make money while they do it. I left EMI 2 years ago because of their lack of acceptance of the digital opportunities in front of them. Life is better now.

But your user name says your spinal tap ?

[bananaboy]

I like how the industry's always complaining about losing sales, but artists like moe., O.A.R., Wilco, and back in the day Phish, Dispatch, and even the Dead always managed to be very financially successful solely based on their live shows.

[TheCrowing2113]

GNR's Fan wrote:

iamspinaltap wrote:

Hi, I'm Ted Cohen, the guy who was misquoted! What I said was that Music Industry 1.0 was over, we've been in music 2.0 for years and now on to 3.0. What I was trying to say was that the music industry is so far behind reality, it's really not funny any more. Instead of trying to sue fans, they should super-serve them, and make money while they do it. I left EMI 2 years ago because of their lack of acceptance of the digital opportunities in front of them. Life is better now.


But your user name says your spinal tap ?

lol. I think without Record Companies and deals, the bands who rely on those deals without money being pumped into them will break up because they'll have to pay for everything theirselves, tour costs,cd costs, merch costs, promotional campaigns, so I think we still need them.

[zeroyon]

iamspinaltap wrote:

Hi, I'm Ted Cohen, the guy who was misquoted! What I said was that Music Industry 1.0 was over, we've been in music 2.0 for years and now on to 3.0. What I was trying to say was that the music industry is so far behind reality, it's really not funny any more. Instead of trying to sue fans, they should super-serve them, and make money while they do it. I left EMI 2 years ago because of their lack of acceptance of the digital opportunities in front of them. Life is better now.

Good, I hope you read my comment posted above. (the long one)

[bucky_2300]

I really think that digital music is good, but I like CDs more. If all hell breaks loose and the all computers die tomorrow, I still have my CDs, but not my mp3s. I like being able to hold something in my hand and say "See? Music!"

[Vermillion85]

JoeyDengler wrote:
People rely on technology too much - the CD is the best format music could be on. If all we could do is have our music on MP3s then what do you do if you go to a party and want to listen to music?

Everyone i know has a hi-fi that plays mp3's,or if not, everyone has a cd burner to put on a standard hi-fi.

If people want music they'll get it. There's nothing cooler than seeing a local band, and buying their EP at the end of the show knowing that the money goes to them. Thats the issue. With any 'major' band people think that if they dont pay, it wont hurt because it only screws the rec company.

If they can organise a way to make the money go to the band more directly, people might start wanting to pay for it.

Now that we have digital distribution, and streaming and all sorts of other methods, you dont need the companies there as much. In the new climate they're more so there to provide the money upfront for production and distribution.

If a band had the means, they could manufacture and distribute a record themselves. The internet provides plenty of advertising for virtually free. It's just the initial money needed.

More than ever, labels are just becoming a bank. You go in, get a loan to make a record, and pay them back (at shit house interest :P).

I'm not anti-label or anything like that. But you do have to wonder if there's a better, more realistic way to get music out there.

food for thought ug'ers... flame away :P

Chris

[-Collapse-]

Most artists earn most their money from tours, anyway.

[That_Dude]

I can't wait until no one buys music at all anymore and people stop making albums and songs all together it's going to be great.

But hey I still refuse to buy music

[DroptheBomb]

good. i hope the major labels keep on losing power.
turn the power to the DIYers and the grassroots and all that good stuff.

[jonnyrotten45]

there about 23 years too late, i.e. the creation of MTV

[OffspringPhreak]

I'm not against the whole digital thing; I just like actually going to a store and *buying* a cd.

Surely there's room for both fair-priced digital downloads and fair-priced cds?

Sharing music will always be around though. First it was mix cassettes(anyone remember those?); then mix cds; and now mp3s.

My money is on them trying something "new" and failing. Sure he says "don't be desperate"; but I got a feeling they will be.

[jonnyrotten45]

-Collapse- wrote:

Most artists earn most their money from tours, anyway.

thats true, i think the record labels just say that so idiots feel sorry for them and thier $20,000,000 house

[SlashNX]

anyone else find this article a bit awkardly written/ I understand whats going on with the music industry, but just found that the article was quite poorly written in getting across the info...

[leadg]

I think what most of yall forget is that even though the record labels screw artist and everyone makes a ****load of money that is without a doubt how artist make their money without labels they don't make money its simple. And being an artist myself i love music and thats the main reason i want to be a famous musicians (for cred, the music, etc.) but money is still a reason to. that doesnt make any of them sell outs. Thats how they live, how they get their equipment, and personally even though it would be a great job i dont think i would do it without knowing that i could make a great living off of it. now back to my point even though the record labels screw artist(which is a shame) they still none the less make a a lot of money to. Only a few, maybe more, artist get screwed to the point of bankruptcy...The system is neccessary its how music goes world wide not just in one city(indy labels) I bet even they want more money in fact i bet you do to so don't act like they nor you shouldn't care about money hell i would love to be a millionaire and why not get that while makin music...

to all the haters out there,
peace

[Scotdizzle]

People...
A) Music IS a business if you make your living off of it, and no it is not evil or distasteful to make it your living.
B)Record companies do need to find a way to make a profit off of it to exist, so they can further create more records.
C) I personally can't wait for a new business model, one that will have to compete with unlimited free music. Honestly, think of the possibilities!

[McGelie]

someone said that cd's cost $12. where do you live? it costs me $18.99. thats why most of my stuff is downloaded.

[omarrodrigez]

We're one step closer to free music.

[Krys Stryker]

omarrodrigez :
We're one step closer to free music.

Yeah that may well be the case, but if all music becomes free record companies wont exist...meaning they wont be able to afford to sign and record bands/artists. then the musicians suffer because they cant get their music distributed to the wider world and audiences.

Making music free WILL stop you being able to see your favourite band and stop you from picking up on the newest bands.
end of story.

[AcrosstheTracks]

i think the main problem with the music industry is that it's become too conservative. labels used to sign bands and develop them while under contract, now labels expect bands to have hit singles ready to go as soon as they are signed, or else they'll be dropped in no time. the fact is, the labels are playing it safe by only hiring artists that can constantly produce hit singles for mainstream listening. it's scary to think that a band like Pink Floyd may have not gotten signed in today's environment. i think the industry needs to start giving the public artists that they can connect with, as opposed to only supporting artists that can produce a quick dollar for the label. i think it will pay off in the end for both the industry and artists.

[CapnKickass]

mosh_rocker2006 wrote:

Alright...here's the deal...music is far from dead! In fact music is in more demand than it's ever been...what's dead is the Record Business. Just because CD's are screwed doesn't mean the music industry will go down.

why must CDs be screwed? I like cds, and plan on buying a bunch more. mp3s are for my computer. it's fun having a cd collection, screw buying stuff off the internet.

[pratt121]

I have a dynamite way for labels to cut costs:

Stop spending so much money creating elaborate, overproduced, huge spectacle pop acts that have pyrotechnics and dancers and huge tours... and start investing in bands again.

Think about it, they hole up in a studio for a bit, release an album, go tour, and there's no need to hire session musicians, dancers, and a million techs for the show, it's strictly bare-bones and music.

"Music 1.0" is dead because the average music consumer only cares about the hot single so they can make it their new ringtone.

[g-tarist]

Jackolas wrote:

As a true musician they can coin as many phrases as they like, but I don't care.

lol well i have never heard of you 'JACKO'

[DatsunsRule]

music execs... who gives a toss? anyone who thinks of business when music is mentioned shouldn't be responsible for bringing us music... thank sweet jesus for the internet, even though I will buy an album I like.

Vornik wrote:

Right... because music has only existed for the past "several decades"...

Pop music was born in the 50s.

*check-it-out*

[omarrodrigez]

Krys Stryker wrote:

omarrodrigez :
We're one step closer to free music.


Yeah that may well be the case, but if all music becomes free record companies wont exist...meaning they wont be able to afford to sign and record bands/artists. then the musicians suffer because they cant get their music distributed to the wider world and audiences.

Making music free WILL stop you being able to see your favourite band and stop you from picking up on the newest bands.
end of story.

haha way to be close minded. Real bands would have no problem supporting themselves if music was free, it would be the Fall Out Boys that would have problems. Record labels are an outdated idea created to make money for themselves and not the bands.

[Matthehopeless]

lets face it, its impossible to get people to want to pay. humans are greedy by nature, sooner or later producing music will be a hobby, not a profession.