There are intellectually honest arguments for why free music is inevitable. The most obvious one is that you can’t stop people from stealing, so you’re just going to have to deal with it, and figure out some way to survive.
But that’s not what you hear from thought leaders like Mike Arrington from TechCrunch and Mike Masnick from TechDirt, as well as others who offer advice and argue positions that are not consistent with themselves — or with basic laws of business or self-preservation.
This weekend, Arrington wrote again, as he has before, that music should be free.
Specifically, the article is about the royalty rate the record companies charge for playing radio music, and Internet radio service Pandora’s claim that it will go under if the rate is not reduced. Arrington says:
For now the labels want to squeeze more revenue out of Pandora and others. But when these companies start to go under and the bird in the hand disappears, they may regret their overly aggressive negotiating stance. It’s time for the labels to die, and anything that cuts off another revenue stream is at least partially good. I’m reluctantly willing to sacrifice Pandora if it quickens the inevitable march of recorded music towards free. Let’s just hope it doesn’t come to that.
So Mike longs for the “inevitable” day when music is free. In the meantime, he argues that the labels’ current stance is overly aggressive. But if music is going to be free, isn’t any price is too high for music?
From there, we move to Mike Masnick from TechDirt, who recently took Warner Music (WMG) for its stance on music royalties for the hit video games Guitar Hero and Rock Band. His argument makes even less sense.
Masnick regularly argues that the music business should be making money other ways than selling “shiny discs”. And in the Guitar Hero/Rock Band case, Warner wants a greater royalty for using their music in the wildly popular video game. So here, it sounds like Warner is taking Masnick’s advice, right?
But not so fast.
Warner is still wrong, Masnick says. They shouldn’t be demanding more money for the use of their music. They should be happy knowing that Guitar Hero is great marketing for Warner Music to sell, err… shiny discs.
So: According to Masnick, music labels shouldn’t plan on selling music in the traditional way. But they also shouldn’t demand substantial licensing fees from a big, profitable video game franchise, even when that franchise is entirely based around music — because that franchise helps them sell music in the traditional way.
You can see how this could get problematic.
At least Arrington is more honest. He wants people to stop selling music at any price. If I were a musician or a label I wouldn’t take his advice, but at least he doesn’t hide his agenda.
On the other hand, Masnick says he’s not against selling music. But when you look at his arguments, he really doesn’t leave much on the table. If you can’t charge the biggest media companies in the world for your product, who can you charge? TechDirt is both a blog and a consultancy, so you’re supposed to take this seriously — someone is supposedly paying for this advice. Why?
SAI Contributor Hank Williams is a New York-based entrepreneur. He writes
Business Insider Emails & Alerts
Site highlights each day to your inbox.