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May 4, 2000 -- Solving the MP3 "Crisis"

There have been many highly publicized stories recently about the RIAA suing MP3.com (story) and Metallica going after Napster and its users (story). Record executives and popular artists wring their hands about all the money they are losing (although it's hard to feel sorry for multimillionaires). Privacy advocates warn of losing the anonymity of the Net as a result of these suits. Music fans just want to listen to their favorite music.

I am really amazed that bands like Metallica, who don't even get the majority of the profits from CD sales, are willing to risk alienating fans for relatively little profit. If people download Metallica MP3s it is reasonable to assume that they are going to want to see the band in concert, since nothing can really replace the experience of music performed live. Why would people want to see a band that brought legal action against them? Why would they even consider buying another CD from them? By threatening to go after their own fans, Metallica could very well be slitting their own throats (although some would argue that they already did that by recording a cover of Bob Seger's Turn the Page).

Metallica going after Napster users is somewhat like them bringing a lawsuit on behalf of their record execs--they are really the ones who will lose money. The Execs hate to think of the idea of losing their great cash cow: selling CDs that cost $1 to make for $16. Granted, stores and other middlemen get their pound of flesh, but it is not unreasonable to estimate that CDs could go for half their current price and everyone involved would still make a healthy profit.

The other thing that gets lost in these suits is the effect that they will have on new, struggling, or independent music artists. New artists would kill to have the kind of free exposure Napster, MP3.com, et al, can provide. If these suits would succeed in shutting these MP3 providers down, the real losers would be these artists. The music scene would be the poorer for it.

The argument that downloading MP3s is piracy is valid. The notion that "all information should be free" on the Internet is noble, but practically it will never work. Rare is the person who will give away the fruits of his labors for nothing--just for the betterment of society. It would be nice if that were the case, but it isn't and likely never will be.

Going after MP3 collectors is about as fruitless as trying to stop the DeCSS code from spreading. For every FTP server that is shut down, three more will spring up. It would be a pyrrhic victory to stop losing money on MP3s by losing all your money in legal maneuvering. Even the most old-school record executives are beginning to admit that MP3s and the Internet are fundamentally changing the way music is heard and distributed.

My question is then, why waste your time and money simply forestalling the inevitable? Why not start profiting off the MP3 movement, right now? Here's an idea that will allow the record companies to embrace MP3s while still making a jillion dollars. This is free advice, no charge. Just remember you heard it here first :)

  1. Lower the price on CDs to something reasonable. If CDs are cheap enough, there will be very little impetus to pirate songs. Why waste time downloading a poor recording of a song, when you can jog on down to the megamall and buy the CD for peanuts? You will make up the profit difference in increased sales.
  2. Make individual songs off CDs (especially hits) available for download for a small fee ($0.50?). I'd do that, just so I know I'd be getting a decent copy.
  3. Put your entire catalogue online. There's a lot of music I'd love to get my hands on, but I can't because the CDs aren't made anymore (GTR's eponymous album comes to mind for me. And no, I'm not going to pay $30 for the import version).
  4. Let users create their own CDs online using any songs from the whole catalogue (not just from a few selected songs like it is now on some sites).
  5. Give the new artist's first single away free as an MP3. Instant exposure.
  6. Reward fans by giving away otherwise unreleased tracks in MP3 format on a band's website. It generates interest, it generates hits, it generates news. Where's the problem with that?
  7. Have Britney Spears, The Backstreet Boys, N'Sync, and any of those other mass-produced crap bands summarily executed. OK, this one really doesn't have anything to do with MP3s, but it's still a good idea.

There you go! Use MP3s, and still make insane piles of money. Smart groups like Limp Bizkit (whose summer tour will be sponsored by Napster) and The Offspring (who will be offering MP3s on their website) already are. None have embraced it more than Public Enemy and They Might Be Giants who have released entire albums in MP3 format. Like it or not, MP3s and the Internet are here to stay. You can either join the revolution or be crushed by it.