In spite of the fact that that I work in radio, that I am (occasionally) a musician, and that I enjoy most if not all types of music, I have absolutely zero love for the music industry. And fewer things annoy me more than when representatives of billion dollar corporations whine about how unlucky they are.
A couple of days ago, Wired Magazine published an interview with Universal Music Group CEO Doug Morris regarding Universal’s development of an online music store. Morris has warmed up to the idea of online music as a viable business model (almost 10 years too late), contradicting his earlier statements that all iPod users were pirates (and not in a hip, Johnny Depp way). UMG has partnered with the Microsoft Zune, and in addition to Microsoft paying UMG one dollar for every Zune sold, is developing an online music store. The store, dubbed Total Music, is Morris’ attempt to both enter the online music world and unseat the iPod.
Universal is well aware of the difficulty of convincing consumers to pay for music subscriptions, so Morris wants the devicemakers to pony up the cash themselves, either by shelling out for a six-month introductory offer or by assuming the cost forever. This would be money well spent, Morris argues, because it would help the Microsofts of the world eat into the iPod’s market share. He has already hammered out preliminary agreements with Warner and Sony BMG and has met with executives at Microsoft and several wireless carriers. If Morris is able to make Total Music a reality, he will once again have succeeded in bending the industry to his will — in this case, by using the combined catalogs of the major labels to help establish a true competitor to the iPod. After all, why buy an iPod if a Zune will give you songs for free?
Unfortunately, Total Music will almost certainly require some form of DRM, which in the end will perpetuate the interoperability problem. Morris likely doesn’t care. He is more committed to Total Music — or any other plan that allows protection — than he is to a future where music can truly be played across any platform, at any time. “Our strategy is to have the people who create great music be paid properly,” he says. “We need to protect the music. I know that.”
It is an interesting business model. Lock out the most widely sold music player (iPod) and use a DRM scheme, the latter which operates in the exact opposite direction in which the music industry is moving. In addition, you ignore the fact that establishing this kind of business model drives people to piracy, but then again, at least you have piracy to blame for your own failures. Let’s also ignore the fact that the music industry also likes to play fast and loose with the rules (via price-fixing and payola) whenever it sees fit.
If one didn’t know better, it would almost seem like Morris has no idea what he is doing.
“There’s no one in the record company that’s a technologist,” Morris explains. “That’s a misconception writers make all the time, that the record industry missed this. They didn’t. They just didn’t know what to do. It’s like if you were suddenly asked to operate on your dog to remove his kidney. What would you do?”
Personally, I would hire a vet. But to Morris, even that wasn’t an option. “We didn’t know who to hire,” he says, becoming more agitated. “I wouldn’t be able to recognize a good technology person — anyone with a good bullshit story would have gotten past me.” Morris’ almost willful cluelessness is telling. “He wasn’t prepared for a business that was going to be so totally disrupted by technology,” says a longtime industry insider who has worked with Morris. “He just doesn’t have that kind of mind.”
I don’t buy this for second. You’re head of the of the largest music label with 25.5% of the market share, which is also tied to a major media conglomerate, and you don’t even know who to hire? Seriously? I think a more reasonable explanation is that you wanted to kill online music before it started. You failed, and so now you’re backtracking and making excuses for not doing something creative like, say, changing your outdated business model. But what do I know, I’m just a consumer.
All of this, of course, is wrapped in this other propaganda the music industry likes to peddle, and that is the myth that they are protecting the artist.
“It was only a couple of years ago that we said, What’s going on here?’ Really, an album that someone worked on for two years — is that worth only $9, $10, when people pay two bucks for coffee in Starbucks?” Morris sighs. “People never really understand what’s happening to the artists. All the sharing of the music, right? Is it correct that people share their music, fill up these devices with music they haven’t paid for? If you had Coca-Cola coming through the faucet in your kitchen, how much would you be willing to pay for Coca-Cola? There you go,” he says. “That’s what happened to the record business.”
Oh, that’s right. UMG is out to protect the little guy - the artists who has poured their heart and soul into their music. This probably explains why, back in December of 2006, the RIAA - that benevolent organization acting on behalf of greedy corporations the music industry in their fight to protect the artists - petitioned the Copyright Royalties Board to have the royalties paid to artists reduced. Because that’s how they look after the little guy.
If you missed it, Morris also implies all iPods are filled with pirated music - something Morris outright stated a few months ago. Of course, Morris has never provided a basis for this accusation, but now is not the time to let little things like facts get in his way. What keeps me up at night is fact that someone would willingly pay for an insipid song like My Humps (owned, incidentally, by a subsidiary of UMG), which I consider a screaming example of what’s wrong with major label music these days. That’s a different rant altogether.
If all this isn’t enough evidence to suggest just how out of touch Morris is, consider Warner Music Groups CEO Edgar Bronfman’s recent confession at an industry conference (from PCWorld, 15 Nov 07):
“We used to fool ourselves. We used to think our content was perfect just exactly as it was. We expected our business would remain blissfully unaffected even as the world of interactivity, constant connection and file sharing was exploding. And of course we were wrong. How were we wrong? By standing still or moving at a glacial pace, we inadvertently went to war with consumers by denying them what they wanted and could otherwise find and as a result of course, consumers won.”
It’s the kind of mea culpa you don’t really expect from a music industry executive. Granted, it comes about 10 years too late, and he’s also right that it is more their problem than the consumers. But UMG CEO Morris is having none of it.
“There was a cartoon character years ago called the Shmoo,” he says in a raspy tenor. “It was in Li’l Abner. The Shmoo was a nice animal, a nice fella, but if you were hungry, you cut off a piece of him and put onions on it, and if you wanted to play football you just made him like a football. You could do anything to him. That’s what was happening to the music business. Everyone was treating the music business like it was a Shmoo.
…
Back in his dining room, Morris is incredulous. He’s once again talking about how his job should simply be finding and breaking new acts. The problem, he says, is that “there’s sympathy for the consumer, and the record industry is the Shmoo.”
I think referencing a cartoon, that ceased production in 1979, as analogy for the current state of the music industry speaks for itself.
For executives like Morris, the music industry was never about giving consumers what they wanted - it was all about telling consumers what they need, and it was easy when you didn’t have to work at it. You had top 40 radio, which sold your product for you (and paid you royalties to do it). You had the “brick and mortar” retail outlets that sold the product the radio stations were pushing. The majority of the consumers didn’t have to think about what they were buying. The heard it on the radio, went to a store, and spent their money.
Of course, when consumers did think for themselves, minor musical movements like punk rock changed the entire face of pop culture - but again, different rant for a different day.
Morris completely forgets that wonderful capitalist concept of free market. Corporations, however, hate it when consumers change the market without their permission. Morris, however, is so behind the times he’s responding to these changes with an already outdated model - all while labeling his own consumers as greedy pirates and the music industry as the benevolent victim. The artists, the very people for whom he laughably claims to be advocating, are caught somewhere in the middle, although he’s not above taking money out of their pockets, either.
I will not be purchasing from UMG’s new music store. As long as they view consumers like myself with such contempt, I’ll be taking my money elsewhere. There are plenty of legitimate alternatives to UMG - and now a days, they’re not that hard to find.
Something I recently learned is that Ben Stein - the teacher from 
