From Polyphony on RB.
From the Milwaukee Journal/Sentinel today.....
Face the music: Record execs slowly embrace Net
Net's role in music industry's future was talk of town at CMJ gathering
By Gemma Tarlach
of the Journal Sentinel staff
Last Updated: Sept. 18, 1999
New York - The music industry has seen the writing on the computer screen: Its future rests in cyberspace.
"The Internet will do more for music than anything since radio," said Steve Devick, CEO of the independent label Platinum Entertainment.
The way we learn what music is available to us, the way we listen to tunes, and the way we buy or access our favorite songs will all change, according to the buzz at CMJ MusicFest '99 this week.
The four-day gathering of 6,000 music industry professionals usually focuses on showcasing new and unsigned bands to labels and the media. This year, though, the cyberfuture of the $12 billion music industry took center stage at the conference, which ends today.
"This revolution is going to happen," said Dave Ulmer, who runs the new recordable CD software group, Burning Point. "Whatever shape it takes, it will happen."
Changes the industry types say you're likely to see in the next decade include:
Better downloadable formats and playing options.
Buzz: The 800-pound gorilla in Internet music is the MP3 format, which allows users to download near-CD quality music onto a computer or disc, usually for free. Other downloadable formats with better sound quality are in the works, and several companies are already marketing Walkman-like devices for many of them.
When: Expect a flood of portable play technology to turn up not only in your average household but in your car within the next two years.
"The TV Model."
Buzz: Much of the stress in the music industry is over how labels and artists will make money off the Internet. While the major labels are trying to develop an encrypted pay-per-download format called the Secure Digital Music Initiative (SDMI), many Web-savvy entrepreneurs look to television for the blueprint to success.
"Look at the TV model," said Devick, who has been a vocal cheerleader for the Internet-music marriage. "On network television, the networks generate the content and the viewers watch it for free. . . . The least popular aspect of the TV model is the pay-per-view, which is the same thing as a pay-per-download on the Internet."
Devick and others at CMJ envisioned Internet portals such as Yahoo.com eventually becoming like television networks, developing acts much like record labels do today but offering their music for free. Profits would come from selling advertising, just like for "ER" or telecasts of the Superbowl.
When: While it's not certain the Internet will adopt the "TV Model," look for portals to at least test it out in the next year or so.
Major labels' last stand.
Buzz: Big-league labels largely ignored the advent of MP3 and downloading mania until late 1998, when they hastily formed the SDMI consortium. Details of the SDMI format, which will include digital watermarks to prevent unauthorized copying, may be announced by the end of 1999, although internal squabbling has reportedly stalled the format's development.
"Ever take 250 people from competing companies and get them in a room and try to get them to agree on something?" asked Ulmer, who has worked with SDMI and become increasingly frustrated. "It's not working."
None of the nine major labels contacted for a comment on this story returned calls.
CMJ attendees doubted that SDMI, details of which may be announced by the end of this year, will do much to corral the free-wheeling downloadable music realm.
"It's like trying to put the toothpaste back into the tube," says Steve Curry, spokesman for Emusic.com, referring to the industry's too-little-too-late response.
When: If and when SDMI becomes available, it will likely be within the next year. Whether it takes off or crashes and burns is anybody's guess.
Improved "sifting."
Buzz: With every garage band out there posting their music on sites such as MP3.com, it becomes increasingly difficult for music fans to separate the wheat from the chaff.
As more users join the netmusic revolution, however, expect more entrepreneurs - or simply music fans - to join in the talent-spotting process.
"A lot of music editors will spring up," said EZCD.com's Todd Cohen. "People will create a site saying 'This is the music I love to hear.' The Internet will become what radio was: If you listen to a station or go to a music editor site that you like, you look at the playlist and that's how you find music you want to hear."
When: The Internet is already nearing a saturation point with MP3 files, prompting sites such as Riffage.com to use interactive screens that make music suggestions based on users' preferences.
More artists in charge.
Buzz: Industry observers predicted some artists with reputations established by the traditional music industry will decide to cut out the middleman - their record labels - and start selling albums directly to fans over the Internet.
"All the artists are going to become much more individual businessmen," said Ari Blank of tropia.com. "They're going to be using the Internet as a 'virtual office.' The major labels are completely behind the curve on this."
When: The trend has begun. Artists such as Tom Petty and David Bowie have tried this with great success. When Petty offered free downloads of his new single last March, he saw his album debut on Billboard's Top 20 - his highest debut ever.
Just Friday, it was announced that Pete Townshend's new two-CD set, "Pete Townshend Live: A Benefit for Maryville Academy," will be available for free downloading Monday, a day before it's released in stores. And fans will get to choose the lead single. The song that is downloaded the most will be the first released to radio.
The death of "physical" music.
Buzz: Despite the rapid developments in downloadable music and other Net-based technologies, CMJ attendees doubted that cybermusic would wipe out your neighborhood record stores as quickly as, say, CDs chewed up vinyl records in the '80s.
"CD and retail stores won't go away," Ulmer said. "Something like 98 percent of music was sold in a physical store last year. The number one music retailer in the country is Wal-Mart. That's not going to change overnight."
Instead, Ulmer and others predicted downloaded music - whether for free or in a piracy-protected, pay-per-download format - will gain popularity slowly over the next decade.
When: The day will come, likely within the next few decades, when those shiny CD jewel cases become antiques.
"All of us who grew up with CDs or vinyl records have a tactile appreciation for them," said Listen.com's Rob Reid.
"Some people think digital music will never take off because it lacks that. But it's a generational thing. Think how quaint it sounds when our grandparents talk about the days they traveled by train instead of taking a plane."
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