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Strategies & Market Trends : Rande Is . . . HOME
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To: B.Long who wrote (6146)5/3/1999 9:16:00 AM
From: Rande Is  Read Replies (3) of 57584
 
No way. MP3 is happy with what they have. The reason it is so popular is that kids are able to share their music. Let's say you have a college website for uploading software [who doesn't?]. . .whenever an artist releases a new recording, the first one to upload it into the MP3 format for the entire school to download is a sort of hero. Within hours all the kids on campus have this recording on file somewhere. So out of an average 50,000 student campus, let's say that 5 percent were planning on buying Korn's new release. That is 2,500 copies. But with it uploaded to the site, 70 percent of that number choose to download rather than buy. That leaves just 750 copies sold to this student body. How long before Korn's label can no longer meet it's obligations? Or worse the band can't meet it's obligations to pay back the record company for all of their recording costs and music videos. . . .and must break up as a result.

If MP3 continues to grow as it is. . .bands will need to sell 3 or 4 times the number of copies they currently sell. . . just to remain at status quo. Not good. It is very hard for recording artists now just to break even. . . especially with Wal-Mart types putting pressure on the wholesale prices of recordings.

As for MP3 divorcing its current format. . .the damage is done and would be nearly impossible to reverse, short of a mass Fed crackdown and laws passed that puts an end to the current model. It is a sticky situation no matter how you look at it.

But my money goes on what will be the winner down the road.

Rande Is
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