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Bob Goldfarb on Media


Sunday, November 23, 2003
    Musings on Music Mergers

    Merger mania has hit the recorded-music business, for the obvious reason that a lot of consumers prefer to download music rather than buy CDs.  Oddly, in reporting that story, journalists assume that record labels will naturally evolve  from selling music on CDs to selling songs via digital files, without recognizing that the transformation is much more than technological.

    What's missing is the fact that record labels, as businesses, have little experience or competence in marketing direct to consumers.  Like the makers of cereal or toothpaste, they create packaged goods that are sold to consumers through networks of retailers.  However, unlike other manufacturers, record labels don't rely as heavily on the strength of their brands.  The names Kellogg's and Crest are far more important to consumers than record-label brands like Epic or Maverick.

    In that respect the recording industry is like the book business, where an imprint (Doubleday, Penguin) is much less important to the consumer than the author and title.  Shoppers don't walk into a store saying "What's new from Capitol Records this week?"  They say, "Have you got the new Radiohead CD?"  That makes it very difficult for labels to start selling sound files to individual customers, because most customers don't pay much attention to the companies that record their favorite artists.  They are much more aware of the retail outlets that stock the kind of music they like.

    Record companies ultimately don't care about the technology that delivers their product, so long as they get paid.  Their apparent resistance to change is actually the result of the entrenched conservatism of their customers, the bricks-and-mortar retail stores.  If they can sell more product through downloads than on CD, they'd be happy to.

    Yet business writers and music journalists have scolded the record labels for not keeping up with the times and failing to develop ways of selling files to fans.  Why should the labels be expected to to that?  Their job is to create the product; retailers are the ones who put that product in the hands of consumers.  It's the retailers who ought to be faulted for missing the boat.  And the retailers are paying the price: some of the biggest record chains are now teetering on the brink of insolvency.  Significantly, Wal-Mart is now gearing up to sell music files online, and may well eclipse the traditional sellers of music because they *do* know how to serve their customers' changing needs.

    As the music-download business takes shape, technology companies like Apple have stepped into the vacuum and are beginning to sell music in quantity.  But they have no long-range incentive to develop a strong competence in marketing songs to music-lovers; they're in a different business.  It's a truism  that the companies with the greatest competence in serving the consumer will be the most successful.  The retailers--not the labels, and not the technology companies--are likeliest to build that competence.  For some reason, as the media cover the music business, that simple insight is virtually absent.

    posted by bob @ 8:03 am | Permanent link
Sunday, November 16, 2003
    A Material World

    The Chicago Tribune's Greg Kot, in a commentary that fronts the Sunday Arts & Entertainment section, deplores a pop music industry where "music is an afterthought."  He points to the decline in CD sales and the consolidation in the music industry, and observes: "in its desperation to reverse the slide, the industry has shifted its goals away from its former strengths: developing artists and letting them grow over an extended career."

    A label can't invest in artists without cash flow.  In the old days, big hits subsidized contracts with unknown newcomers.  Now that consumers get their favorite music by file-sharing, the record companies don't have the money to risk.  That doesn't mean music is an afterthought, nor does it portend a cultural shift from art to celebrity, as Kot seems to think.  It's just the way markets work.

    Nor is it new.  Kot argues, implausibly, that "music remained essential" when Ricky Nelson and The Monkees were created as celebrities.  "Whereas in the past the music urged us to know the performer," he laments, "now the music is merely a byproduct of celebrity."  But that lost past never existed.  Celebrity eclipsed music when Franz Liszt or Paganini or Vladimir de Pachmann or Caruso went on tour, long before Ricky Nelson was born.  The public's preoccupation with celebrity didn't start with reality television or with the arrival of MP3.

    Kot is just plain wrong when he imagines a "bottomless corporate budget" to promote Britney Spears' new CD.  Labels support their biggest artists precisely because they don't have enough money any more to take chances on unproven talent; that's why they increasingly rely on performers who are already famous.  The companies are just giving the public what it wants.  Kot may blame Britney Spears and her promoters; in reality the fault lies not in our stars, but in ourselves.

    posted by bob @ 3:00 pm | Permanent link
Thursday, November 6, 2003
    Artistic Freedom

    When Viacom decided to broadcast the mini-series "The Reagans" on Showtime instead of CBS, Barbra Streisand said it "marks a sad day for artistic freedom -- one of the most important elements of an open and democratic society."  But access to the CBS television network is hardly the same thing as artistic freedom.

    Showtime's biggest hit is the soap opera "Queer as Folk."  Like the transgressive shows on HBO, this series is successful precisely because its content is too controversial for an over-the-air network.  If "The Reagans" has a viewpoint that will polarize viewers, it is also better suited to cable than to CBS.

    That's a different issue from whether the Viacom people made their decision for political rather than business reasons.  If Viacom could make more money by presenting the show on CBS than Showtime, and instead succumbed to pressure from political groups, that would be a serious issue.  But the two are not at all the same, and it's not helpful to confuse them.

    posted by bob @ 5:34 am | Permanent link

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About Me
I'm a consultant in the arts and media, specializing in classical-music radio and recordings. My professional expertise ranges from marketing to management to artists and repertoire, but my enthusiasms embrace just about all the mass media, with a particular emphasis on the arts. More


About Media Res
Society and culture in the age of the Internet are more exposed than ever before, subject to examination and investigation instantaneously and ubiquitously. But we human beings still haven't outgrown our capacity to overlook the obvious, or to believe what we want to believe no matter what the evidence to the contrary, or to mistake our narrow prejudices for high ideals. This blog will look at the interrelationships between the media, culture, and society from different angles, maybe with a few surprises now and then. More

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Sites I like...

One of the greatest success stories on the Web must be Jim Romenesko's daily roundup of media industry news, under the aegis of the Poynter Institute.  Crisply written and totally in touch, it's indispensible. 

For news about radio I check the home page of the industry publication "Radio and Records." 

The weekly NPR show "On the Media" takes a consistently fresh look at the media, and the Website makes it easy to listen to segments of the show if you don't find it on your local public radio station.

Among the best media critics around is the Los Angeles Times' Tim Rutten, who writes its "Regarding Media" column twice a week.

And some of the most entertaining and penetrating coverage of the media comes from satirist Harry Shearer on his weekly radio program "Le Show," originating from the fertile ground of KCRW Radio in Santa Monica, California and broadcast nationally.  Current and past shows can be heard online through the Website.

To keep up on current books, performers, and issues in the arts, I listen when I can to Leonard Lopate from New York's WNYC.  The media are not the main focus, but the show is brilliant, always timely and well-researched, and with terrific guests.  As an interviewer, Lopate is in a class by himself: curious, witty, articulate, extraordinarly well-informed, a superb listener.  It's one of life's great mysteries that his show is not broadcast nationally, but at least it's streamed on the Web.

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