The music industry is in a fascinating transition from plastic CD sales to digital distribution. Once again, like in the 1950s and 1960s, the pop music “single” is the driving force only this time the “singles” are being purchased online via digital distribution outlets. The music industry is alive and well and thriving. It has just undergone another historical paradigm shift concerning the way in which music is distributed and monies collected. No more physical distribution monopolies. In the past, a huge percentage of money generated through physical record sales was tied up in the costs of physically distributing the records to the stores. Now, digital distribution eliminates that cost and completely reinvents how artists get paid. It is the death of the old physical distribution model and the emergence of the new digital distribution model. That means the industry that grew up around the old model is disintegrating while the new industry emerging around digital distribution is being created.
This is a major reason for the Writer’s Strike in Hollywood. Their old contract, which is only 4 years old, has become irrelevant virutally overnight because of digital distribution. No longer are writer’s getting paid through physical distribution channels because that is no longer the way in which the movie industry earns their money. Now, the movie industry earns their money largely from digital downloads and the writer’s contract does not address this, and therefore, there is a strike. The strike is a symbol of the paradigm shift from physical distribution to digital distribution.
We live in an exciting time, indeed! Now, artists are able to digitally distribute their product to virtually the entire planet with the click of a button and perhaps a small fee paid to set up their media content at places like CDBaby.com. There still remains an organized effort by major labels to maintain a monopoly on “Ringtones.” Ringtones are a huge source of profit for musical artists. Ringtones accounted for %85 of AKON’s earnings in 2007, and his story is not unique. Ringtones are a huge source of revenue for artists and major labels. However, independent artists are muscled out of the Ringtone game by the major labels. CDBaby.com offers over 50 different digital distribution outlets to independent artists, however, CDBaby.com and independent artists are shut out of the Ringtone market. CDBaby.com helps indie artists get their music on places like Apple iTunes, Napster, Rhapsody, Payplay, and many many others, however, the lucrative Ringtone market still elusive. The Ringtone market will not be monopolized by major labels for long, however. The constitutionality of major labels using their billions of dollars to keep %99 of artists out of the Ringtone market is clearly suspect and there are major efforts under way to ensure that indie artists are able to join in the lucrative Ringtone market through places like CDBaby.com.
Anyways, my dissertation on digital distribution will be available in hardcover and paperback (as well as online!) in February 2008. The title of the book is “How We Did It: The Story of the band Pet Virus” and is published by Vesuvius Records Publishing copyright 2008.
Here are some links to my Vesuvius Records catalogue which I have produced.
http://payplay.fm/label/Vesuvius+Records
And, of course, the entire Vesuvius Records catalogue is available from Apple iTunes as well!
Keep your ears peeled for Pet Virus’ Vesuvius Records debut due in Spring 2008!
