The future of the Music Industry?
                 by John Chambers
               jc@trillian.mit.edu
		          November 2000

A coworker at a recent job had an  interesting  hobby  that
was slowly turning into a full-time business. It may be the
future of the music industry.

He was really into new, experimental music, and knew a  lot
about the Web. So what he did was create a web site for the
use of the local bands playing this music.  He would accept
recordings  from them, convert them to MP3, and put them up
in that band's directory for anyone to download.   He  also
supported  email and chat groups for each band.  He charged
the bands just enough, I think it was about $10 per  month,
to cover his costs. He had dozens of bands on his site. And
he gets into any of their gigs for free, of course.

What makes this interesting is that  he  has  also  had  to
start  producing CDs for the bands.  This tends to confound
those not familiar with Web economics,  but  in  fact  it's
common.   A  CD  is  a  very convenient way to carry around
music. After a band gets a small following and has a set of
tunes  online  that  people  like,  requests  for CDs start
coming in.

But these CDs don't get produced quite like  the  recording
industry  makes  them.   A  common  problem with commercial
"albums" is that you typically get one or two cuts that you
like,  and  the  rest  are  just filler (from your point of
view).  The musicians are as  frustrated  by  this  as  the
listeners, but there's little you can do about it. The real
problem is that there's no way to  get  any  listener  feed
back until the CD is out there for sale.

But things are different in this case. What happens is that
a  band  is  at  first  surprised  by the requests for CDs.
"They're willing to pay for music that's free?"  Then  they
start to take it seriously.  They discuss the CD with their
online friends, and together a set of tunes is worked  out.
Probably by this time most of the tunes have gone through a
number of versions.  The fans have criticised  them,  often
ruthlessly.  The band doesn't always agree, but listens and
makes more versions.

Finally they decide they've worked it all out, and a CD  is
made. Most of the fans order a copy, because nearly all the
cuts are good (by their standards). The price is lower than
commercial  recordings,  all  the cuts are keepers, and the
band gets half the money.

The fellow who was running all this had started  to  mumble
about  quitting his day job after the next layoff and using
his "hobby" to build up his retirement fund. He also really
liked  the  idea  that  he  was doing an end run around the
turkeys in the recording industry,  who  act  mostly  as  a
barrier between the musicians and their audience.

He was also helping friends in several other cities set  up
their own local-band web sites. Anyone interested should do
a bit of looking around, and start doing the same  in  your
area.   With  a  bit  of  work,  we  can kill the recording
industry and replace it with a direct  musician-to-audience
system, complete with good feedback.