Editorial: Comparison between music and movie industries

[Butter]

Swiped this from another board, thought it was very interesting and brings up some good points.

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Sunday, September 14, 2003
commentary
Recording industry's missteps


By Michael Booth
Denver Post Entertainment Writer

The best-selling "Chicago" movie soundtrack is available on CD
starting at $13.86.

The actual movie, with the soundtrack songs included, of course, plus
additional goodies ranging from deleted musical numbers to the
director's interview and a "making-of" feature, can be had for
precisely $2.12 more.

Therein lies the problem for a critically wounded music recording
industry: The "Chicago" CD looks like a rip-off, and the DVD looks
like a steal.

Nearly everything the record companies have done wrong in the age of
downloading has been done right by the movie studios.

America's love for movies is stronger than ever, while the nation
listens to music with smoldering resentment.

While movie companies escort happy customers to newly-installed
recliner stadium seats, the music companies escort their biggest fans
straight to the courthouse. There is only so much time for
entertainment in a busy day, and people will spend their leisure
where they meet the path of least resistance.

For every slight by the music world, there's a smarter parallel move
by the cinema promoters:

Not until 20 years after the introduction of the CD in the United
States did a record label announce across-the-board price cuts that
acknowledged consumer anger at paying $19 for one decent Justin
Timberlake song. Universal will now drop prices on many CDs to below
$10, a breaking point many buyers seem to accept.

In contrast, the movie studios saw the threat from pay-per-view cable
and satellite in 1997, when DVDs first arrived here, and slashed
prices immediately. DVDs started between $19 and $24; today hundreds
of great titles are available in the $10 range. With "Pirates of the
Caribbean" still taking in great business in theaters, a two-disc DVD
version will arrive before Christmas for $18.

People listen to the average CD many more times than they watch a
DVD. Yet CDs are languishing in stores and DVDs are flying off the
shelves. How to see this other than sheer music industry incompetence?

Music companies stood by while one of their primary conduits to the
public, radio stations, consolidated and grew numbingly homogenized.
The variety of music stations offered to the public shrank
drastically. Many listeners in their 30s and 40s gave up on trying
new material.

In the 1990s, the movie industry increased its product outlets across
a wide range of styles. Multiplexes overbuilt to the point of
bankruptcy, but the result for the consumer was convenient playing
times and a near disappearance of daunting ticket lines.

Art houses expanded screens in many cities, providing venues for
truly obscure intellectual adventures as well as extended runs for
word-of-mouth hits not big enough for the 'plexes. Thus you can still
see megahit "Bruce Almighty" for a buck or the acquired taste of
"Winged Migration" three months after it opened.

Movies operate largely from the same why-fix-if-it-ain't-broke box office.

The concert business has Ticketmaster. Enough said.

Threatened over the past decade by various forms of piracy, the movie
industry chose to go after profiteering international crime rings
while letting the local cable companies take on illicit home
descramblers with low-key enforcement action.

The record labels, not satisfied with infuriating a younger
generation with high prices and legal threats, is now enraging
clueless middle-aged parents forced to pay $3,000 to $15,000
settlements over individual downloading lawsuits. Record companies
pursued an act of Congress for the right to invade the privacy of
Internet companies and customers in search of burners' personal
information. For good measure, the labels forced a New York
12-year-old to pay a $2,000 fine, taking customer relations to a new
level.

Through a combination of intelligent design, lucky accident and the
good sense to follow the consumer's lead, movie companies settled on
the VHS video format for 25 years before gently introducing a DVD
alternative. It then let the DVD win out by making it more attractive
rather than cynically undercutting VHS. The minor distractions of
laser disc and Beta video, which could have irritated consumers if
allowed to fester, were dumped.

But the music industry instead allowed format changes to drive its
business model.

The CD format saved the business for 20 years because consumers had
little choice but to replace vinyl or tape copies with CDs to keep
their libraries relevant. CD makers knew they were borrowing from the
future the day the last Bob Seger 8-track gave way to a new CD, but
did nothing to expand their market on radio or among new buyers.

Even the blank CD formats are mired in confusing infighting over CD-R
and CD-RW. Many store-bought CDs can't play in computers or other
older components. Mini-disc, anyone?

Record label missteps are legion. But solutions are at hand: Let go
of whole-disc sales and create a dollar-per-song online service as
good as Apple iTunes. Make it universally available, with all the
independents signed up.

Bring Ticketmaster to heel and make live music accessible and fun
again. Allow file sharing for a $50 to $100 annual license. Woo
40-year-old buyers as if they were 16.

Most of all, spend less on lawyers and more on creative thinkers. You
can't subpoena success.

[Blackadar]

Good article. I've bought maybe 50 DVDs over the past two years and 2 CDs. The record industry puts out a lot of dreck and then serves it up in unpalitable ways.