Friday, March 05, 2010

Music Economic Model = Fail

The problem is the economic model no longer works. Here's the quick and dirty process of how things like video games get made and consumed.

Create Data
Create Storage Medium
Put Data Onto Medium
Sell Medium

Let's take music for an example. The difference between recordings from the 20s and those of today is in the medium. Records had their costs based on several factors - materials, manufacturing labor and technology, distribution, and non-replicability.

Compare that to digital data - no materials, no manufacturing, nearly unlimited distribution, nearly unlimited replication. The only cost is the electricity consumed and the computer hardware which it runs through.

Why could record companies charge $20 for a CD fifteen or so years ago? Because you couldn't copy them, or make them yourself. Then people found ways to rewrite discs and to burn their own. Suddenly a CD of music costs mere cents for the discs themselves and the electricity to put data on them.

The costs of artists actually making art hasn't changed. The cost of distribution has dropped. The total cost of producing art has dropped as a result. Consumers simply will not continue to pay the old prices which no longer reflect current costs.

My proposed solution? Artists return to patronage systems. Video game developers are directly paid by gamers to develop their games. Musicians are directly paid to create new music. Cut out the corporate middle-men, send them packing. I'm sure they can find equally underhanded and money-grubbing employment elsewhere. Such as Wall Street.

~D. Walker

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