This was a great day.

I am going to geek out a little bit, here, folks, and possibly (no, DEFINITELY) neglect to talk about a lot of great things that were discussed. In my defense, I bet everyone in the room today at FMC Policy Summit has some artist or band that largely inspired their entrance into the music business. For me that was REM.

Bertis Downs, REM’s career long lawyer and advisor, sat on a fantastic panel to start the day about DIY Models in music. I must tell you that from the time I was 12 years old in 1985, I not only knew everything about REM, the band members, their songs, and their videos… I was the kid who also knew who their MANAGER was and who their LAWYER was. Yep. By 36, the name Bertis Downs has been a part of my personal music register for the most of my life. “Berry, Buck, Mills and Stipe”, was incomplete, in my mind, without “Holt and Downs” tacked onto the end.

Flash forward to today, Monday morning at the Policy Summit: There I am, asking the panel a question, and there’s Mr. Downs answering …. conscientiously, enthusiastically, and respectfully … and for that little interaction with a guy who’s name I’ve know 20+ years, there was a little part of me “flipping out” on the inside.

But Mr. Downs’ really put the icing on the cake a couple hours later that same morning. After REM Bassist Mike Mills’ fantastic interview with newly sworn-in Senator Al Franken had let out, and sufficiently after the hub-bub died down in the lobby outside the conference hall, Mr. Downs seemed to go out of his way to pull me aside and introduce me to Mike Mills.

Talk about connecting with the customer!

The day was packed with informative debate all around. I feel a little bit silly for not delving into my thoughts around debates about net neutrality, ISP monitoring and filtering issues, the Performance Rights Act, Health care for artists, and many other key important topics.I encourage you to  read the chain of messages surrounding all of them and more by searching #FMC09 on twitter.

I am having incredible fun.

- Brian

I remember seeing the film “Berkley in the 60s”  (a documentary about the free speech movement at Berkley College in CA which preceded and led to the hippie movement), and thinking to myself, “Man, these kids are so intelligent! I was a complete idiot when I was their age!” Perhaps this comes to mind because the sheer level of intelligence that surrounds me here at the Future of Music Coalition’s annual Policy Summit in DC. I am also here with Weathervane’s very own with Katonah Coster, too. She IS only 21. All around, I am thoroughly impressed.

Perhaps the most important thing I come away with from day 1 was a thorough understanding what the FMC is working toward. Founder and Policy Director, Michael Bracy described Radio’s demise since the 1996 Federal Telecommunications Act which deregulated radio and within quick succession did away with locally owned, independent radio, making the chances of local independent artists receiving airplay near to impossible. He then explained the concept of Net Neutrality, which simply boils down to keeping telecommunications companies from limiting what their customers can access on the web. It’s amazing to understand the potential revenue Comcast could earn if they only allowed the highest bidder to distribute music through Comcast, for instance, and that Warner Bros could actually offer a package that allows customers to pay smaller bandwidth rates if they use the limited selection of net coverage WB “bundles” in the package. This was particularly insidious once explained.

The Future of Music Coalition decidedly concerns itself with matters of public policy, and therefore WON’T be putting its nose into private service providers’ matters. I for one, though, see this as a bit of a missed opportunity to be the voice they are for the musician. FMC believes that the marketplace will determine what flies, for instance, with regard to Spotify’s decision to only allow artists that are on labels to stream through their service. (See this article from the Guardian Aug 2009). This looks a bit like the “structural payola” Bracy defined in his conversation about Radio Policy, and while I know Spotify is NOT a part of the terrestrial radio and FCC monitored structure, it certainly seems like it could corner a market, and therefore have similar effects.  I personally don’t believe the average consumer will stop using Spotify with this knowledge (and for most they will never know what they are missing). This is not to say anyone can regulate service providers decisions, but musicians and consumers can use an informed voice. The FMC, clearly the most intelligent voice on behalf of the artist, should not miss key opportunities to clue consumers in on matters such as these and their ramifications.

I’ve been reading FMC articles for some time now, and they usually don’t miss such opportunities. … Just sayin’.

In this time when all musicians should be engaged in the struggle to define a future model for career sustainability, I can’t help but fear that the FREE business models, ubiquitously held to be the future of music, media and just about everything else, will be an embarrassing footnote in recent industry history. Worse yet, I fear musicians and artists themselves, the willing subjects they always are (yet rarely the financial beneficiaries) will be no farther along in their pursuit of a security with their art.

In the late 90’s we had the Dot-Com Bubble. Hundreds, thousands of businesses all started in a Dot-Com gold rush. Few had any vision for how they’d be profitable. Most of my friends worked at these places, and they were caught up in it as well… stock options, initial public offerings, etc. They could collect a paycheck, a GOOD ONE,  for a couple years, but only because of a misguided venture capital trend. When the whole thing came crashing down, they all lost their jobs, and the stock they hoped would be their retirement was worthless.

Flash forward, 2003 - 2007: The Real Estate Bubble. I watched my own home’s “value” quintuple, as did many of my friends in Philadelphia, particularly in Fishtown where I live. But “asking prices” weren’t any indication of true value; they were just a future bane for people who were unfortunate enough to pay these prices. ‘Another bubble, this time fueled by a misguided, criminally lax, even “predatory” credit market.

Our cultural appetite for all things FREE comes from the behaviors and attitudes of the aforementioned era. Paying with credit… It was pretty much like not paying at all. The economy ran on home equity loans and lines of credit, something far too few of us understood and it all came crashing down. The mad rush to start new businesses that run on FREE (and the equal frenzy to retrofit the old businesses to get in on the action) is just all of us clinging to this old behavior. It’s a cultural attempt to keep that spirit of (apparently) “inconsequential” hyper-consumption alive, in a brave new world where we can no longer run up credit to our hearts’ content.

So here we are: 2009, The FREE Bubble.

Most FREE business models will give away products and services with the hope of generating site traffic and advertising revenue. IF advertising proves effective - that is, IF people pay for advertising and, more importantly, IF the advertising WORKS over time, then everything will be fine. But the latter, especially, is one humungous “if”. I know I don’t see advertisements when I look at my desktop. People more sophisticated than I can block the stuff that really gets in the way, and as for the things in the corner, the things that look like advertisements? Our eyes don’t even focus on them.  We just don’t see them.

God forbid, if this thin path to revenue fails, then what? 

To entrepreneurs caught up in the hype, FREE is quickly becoming the new, apparently “necessary” cost of doing business, and it is driving up a specious, perceived value for businesses by the dozen. In a year… two years?… Will FREE businesses work, or will this simply be another bubble? Only time will tell. If it is, this one is on the backs of musicians, artists, and the value of their work. As always, they are the perennial, willing test subjects, but in almost all industry models, they remain the last ones in line.

This is a great article (thanks for passing it along, Katonah).

http://www.hypebot.com/hypebot/2009/09/the-high-cost-of-going-negative.html#more

You can scroll all the way to the bottom to see my comments, or read it here, below:

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Excellent article.

The problem is that in the past it has been easy for artists, and the industry behind them, to take their fans for granted. It’s simply shifted the other way: fans take the artists for granted.

I agree that the best spokespersons for a real movement need to be credible artists - ones that don’t simply appear to have eaten sour grapes.

I’ve been working with a few associates to design a new model. We’re in the US, we’re called Weathervane Music, and in a nutshell, we’re a non-profit, member supported artist development organization. We produce a series of high-end audio and video called the Project Series . Through the series a select set of sophisticated independent musicians have a unique opportunity to make recordings they can use and/or license to other for-profit companies, while the creative process is documented in video for purposes of exposure for the artists, and promotion of Weathervane’s mission. 2010’s series will include special guest curators, well known, well respected musicians, who have a chance to expand the significance of their taste in music, by selecting OTHER great artists for the series. You can see the projects at http://weathervanemusic.org/projects.

We can look at this era as a period of Natural Selection for the fittest business models, but I don’t think we can simply expect that the industry and consumer will naturally do what is best for the future of music in our culture. Just like the environmental movement required education and a shift in attitude throughout society to get started, music needs to be saved in the same way: by fans, artists and industry TOGETHER.

Check out Kyle Bylin’s recent article. Then see our comments below!

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You are onto something, here! But whatever “saves the industry” is not going to just happen on it’s own.

We need to educate and inspire music fans to care for their favorite artists in such a way that they WANT to support them financially. Whether that means buying music (in the present) or participating in other activities that put money into artists’ pockets, it doesn’t matter.

Weathervane Music is taking a crack at achieving this goal. We’re a brand new nonprofit, and much organization still needs to fall into place, but we believe that building a membership of music fans and musicians alike that are willing to ACTIVELY support great independent artists (to be “ACTIVISTS”), we can start a small but powerful movement, one we hope will meet up with and influence whatever developments the industry requires.

It’s reassuring to see Eric Harvey’s (Pitchfork) quote: “… fans could take the initiative to create a new [structure that holds together the industry].” This is what WV hopes to be a part of.