By now, observers of the various e-commerce markets can see which business models work online and which do not.
Online travel sites? Check. Online bookstores?Check. Online music? At first glance, no. But guess what? Check.
For a while, online music looked shaky, especiallywith the proliferation of bootlegged tunes, copyright infringement suits and technology that moved faster than the law could keep up with it.
But this month, a major hurdle was crossed when the RecordingIndustry Association of America (RIAA), the National MusicPublishers’ Association and various associated agencies finallymet each other halfway and cleared the way for the legal licensing of online music.
The Band Plays On
This has been a long, protracted battle, during which upstartslike Napster became electronically — albeit temporarily — omnipotent,only to find themselves confronted with copyrightinfringement suits and damage claims in the billions.
If Napster is relatively quiet at the moment, so be it. Its unlikelyoffspring, MusicNet and Pressplay, are ready to pump up thevolume. And unlike beleaguered Uncle Napster, the two newcomerswill debut with the blessings of everyone who counts in this drama.
While all the dollar-for-dollar kinks are still to be worked out,what matters here is that the Old Economy — the very Old Economy — and the New Economy have had a group hug. Such compromise betweentraditional commerce and its Johnny-come-lately competition was considered unlikely as of a few months ago.
Coming of Age
It’s true that even if the various music industry players had not found common ground, music lovers would still have found ways to access music online.
Brick-and-mortar music stores would continue to thrive, even as illicit file sharers would one way or another download to their hearts’ content.
Nevertheless, the online music agreement matters because it represents the best of what e-commerce can bring to the commercial table. It matters because it represents the recording industry’s official recognition that online music vendors and traders are here to stay.
Make no mistake — e-commerce did not truly need to be validated by Old Economy stalwarts in order to reach its goals. But it doesn’t hurt.
It could be argued that e-commerce has been around long enough not to have to continually prove itself to its commercial elders in the brick-and-mortar world.
But traditional American commerce goes back much further than even the United States itself. True Old World commerce, in European locales, established the foundation for the buying and selling methods that American companies still employ.
Given that perspective, it is not surprising that e-commerce, arguably less than a decade old, is still in the business of validating itself in the world marketplace.
The uphill battle that has characterized business-to-consumer (B2C) e-commerce is all the more reason that this week’s agreement represents significant progress.
The agreement clears the way for music subscription services online to become de rigeur in the world of commercial music sales. It potentially sets a new standard for consumer music sales, one that establishes the subscription services as simplyanother legitimate channel among many.
That is music to the ears of not only those in the online music business, but to others in the electronic commerce community who have closely followed the copyright struggles — the power plays among the Big Five record companies and the established artists who fear their work would not be fairly compensated when transferred online.
So, problem solved, right? Not so fast.
As it turns out, the underground trading of music online is alive and well. File-sharing is so simple, and so pervasive, that all the handshakes among enemies and legal wranglings in the world will never stop it.
That calls into play the need for responsible use of technology, and since no one can legislate morality, there will always be those who abuse it.
How to combat the abuse? Online music subscription services will need to do some smart, high-powered marketing, creating a need and a desire for their products and services.
It looks as though they have their work cut out for them, but this month’s progressive agreement among the previously divided factions goes a long way in advancing the online music marketplace.
What do you think? Let’s talk about it.
Note: The opinions expressed by our columnists are their own and do not necessarily reflect the views of the E-Commerce Times or its management.
It is not a surprise to see the new economy and the old economy reach an agreement on electronic trading of music. As I have myself noted in stories dating back a year, it was inevitable. Economics dictated that the music cartel would look to maximize profits by charging more for less. Digital data transferred across a network is less expensive than CD, so the big five would push for it, but under circumstances that they could control.
In the end, the music companies’ offerings change nothing, crippled files distributed electronically help neither consumer nor artist, only the distributor. It may make online music fly temporarily, but what is the long term effect of overpriced inferior products on the market? With a field that is tilted (by law) in favour of the entertainment conglomerates over the rights of the consumers, smaller distributors and the actual authors of creative content, what does the future hold?
It is, perhaps, time for artists to consider their own alternative, one that seeks to ally the interests of the consumer to those of the creator. Electronic distribution does eliminate hurdles to market entry, and a digital distribution network has the potential to eliminate the necessity for the major music label cartel.