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Recording industry could reach billions... But they aren't playing ball

By Mauricio Freitas, in , posted: 13-May-2011 12:26

As per my previous post Is "lost sales to piracy" a fallacy, the problem is really coming down to the content industry not knowing what to do with the new dynamics of distributing content at light speed, to reach all those potential customers around the world.

The industry could reach an even larger number of customers, billions even, if partnering with the right digital media companies, and breaking geographical limitations. Services provided by these digital media companies include Apple iTunes, Amazon MP3 and a new kid in the block, Google Music.

Have you heard of Google? Apparently they reach every corner of the world, and they have a huge content distribution network, with lots of storage, switches, routers and that is needed for content distribution. Economy of scale! Distribution speed! Cheaper copies of bits! Instant money transfer!

And what does the music industry do? They turn greedy and lose their senses.

Labels of all sizes wanted upfront advances. Google was willing to pay upfront advances. But some labels wanted larger upfront advances than others. And then other labels would learn of the advances agreed to in those deals and then demanded similar rates. And the independent labels wanted to be treated on equal terms as the majors.

Obviously if you can create scarcity then you can control prices. But this is a false scarcity of a digital item that could actually be distributed over and over again, without the manufacturing costs required for LP 8 track compact cassete CD/DVD. Why not go for the volume instead of the limited market?

Another example of how this industry doesn't know what to do to keep up with the times. And a new copyright law is not the answer for their problems.



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Mauricio Freitas
Wellington
New Zealand


I live in New Zealand and my interests include mobile devices, good books, movies and food of course! 

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