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I Want My MP3

By Derek Slater

When MTV gained notoriety in the early 1980s, it sent shockwaves through the entire music industry. Suddenly, the way people gained access to music was revolutionized. Rather than simply hearing music ove r the radio, people could see artists in music videos. Fans and artists loved this idea, as artists attained a new medium to connect with fans. They could promote their music in a more personal manner sin ce consumers could see them, rather than just hear them. Artists like Billy Idol, and The Police proclaimed, "I want my MTV!" on various MTV commercials to encourage cable stations to use MTV. Dire Straits wrote an entire song where "I want my, I want my, I want my MTV" was chanted in the background. The music industry was not as eager as the artists to make this change. The music industry had to shift fro m merely marketing the music on the radio to marketing both the image and the music of the band as a package. Although it might be hard to believe now, when music companies use expensive music videos to pr omote nearly every major artist, the industry scrambled to alter their marketing scheme to fit the new MTV audience in the mid-80s. A similar revolution in music is taking place now. While the music industry attains a new medium for marketing and distribution, no one is quite sure how to grapple with another three-letter acronym: MP3.

Winamp Screenshot
Winamp MP3 Player

What are MP3s and What Do They Mean to the Industry?

MP3s are computer files that contain music. They are CD-quality, and are so small that they can be transferred easily over the Internet. MP3s are so easy to create and transfer that they cut out the middleman between artist and consumer. Recording companies justify charging exorbitant prices for CDs by citing distribution and marketing cost s, so artists see very little of the revenue earned from their CDs. With MP3s, there are no large distribution and marketing costs. Certain artists are reluctant to sign on with major record labels when t hey can take their music right to their fans over the 'Net. The Internet is so expansive that word of mouth is enough to market music effectively and artists can give their music to listeners at the click of a button.

There might be over six thousand people using Napster trading over fifty thousand hours worth of music illegally.

Who Uses MP3s?

Artists who haven't been noticed by a major record label have flocked to the Web in huge numbers. Bands from all over the world have put up their own websites, or joined larger sites like MP3.com. MP3.com provides space to put music on the Internet to artists who are unaffiliated with a record label. If people like the songs they listen to on MP3.com for free, they can buy CDs or pay to download the album in MP3 format for about $7-$10. The artists get a large cut of the sales, unlike artists signed to major record companies.

Recently, MP3.com has helped jumpstart the career of Petaluma band Headboard. Like most bands, Headboard figured they had little chance of getting noticed by anyone in the industry. But, Headboard signed on with MP3.com and set up their own personal website. Soon after, their popularity began to grow and grow. Recently, they appeared on Farmclub.com, a USA TV show, showcasing popular bands of the Internet. On April 22nd, Garageband.com awarded Headboard a $250 thousand record contract after they won an online contest pitting hundreds of artists against each other. (See Page 14 for more info about Headboard.)

Many popular artists see MP3s as a better way to publicize and give their music directly to fans. Furthermore, they view it as a way for artists, rather than money-hungry record companies, to profit more from the music. MP3.com funded Alanis Morisette's latest tour, and she put many of her songs on MP3.com. This tactic helped sell tickets for Alanis' concerts and helped advertise her album. Chuck D of the famous rap group Public Enemy is the most outspoken supporter of MP3s. He is now signed to an Internet-only record label that splits profits fifty-fifty with artists. "The web is a great liberator," Chuck states. "It shifts the art a bit away from commercial dictation and domination. [I hope artists become a part of] the new revolution and become participants in a larger global music business, thus making their own rules for success."

Is This Becoming the Norm in the Industry?

The "Big 5" (Universal, BMG, Sony, EMI, and Warner) record companies control most of the music world. Even though you might buy albums from labels like Maverick of Island Records, the Big 5 control these companies and produce nearly all albums you see in a record store. When they saw all the smaller, independent record labels rising on the Internet, they knew they needed to make more of their music available online to compete with the independent labels. Each company plans on "going digital," but they cannot keep up with the pace of the smaller, more accessible Internet record labels. Even so, record company profits have yet to drop, and artists continue to sign on with big labels to get large, upfront advances. Online labels aren't the norm even though they have attracted the attention of many smaller name bands hoping to get noticed. Still, MP3s scare the record companies. As computers and new technology become a larger part of our lives and the economy, online labels could become the norm and pose a real threat to the Big Five. This is not the case yet, but it could become reality in the relatively near future.

Napster Search Screen
Napster Search Screen

The Piracy

Perhaps you have liked a CD a friend has, and have made a copy of his CD onto another CD or an audiotape. US copyright laws prohibit this act - termed "piracy" - since you are not actually paying record stores for the copies and, in turn, not paying the record companies. Just as people can illegally pirate CDs by copying them onto other CDs or audiotapes, people can also convert CDs into MP3s and distribute them over the Internet. People can take a CD that they have bought, turn the music on the CD into MP3 files, and then put those MP3 files on the Internet so that any one may download them, free of charge.

Record companies have already begun to take action against music piracy. They fear that the Internet could facilitates vast music theft, because instead of people being able to only pirate their friends' limited CD collections, people will have access to the collections of thousands of Internet users who put MP3s on the Internet. Piracy has increased, and record companies could lose recod sale money in the future.

Napster, a computer program for Internet users, allows people to pirate music easily. One must only perform a quick search for the desired song, and then that song can be downloaded within minutes. At peak hours during the day, there might be over six thousand people using Napster trading over fifty thousand hours worth of music for illegally.

Napster Zoom

Virtually any song is available. Due to this piracy, the RIAA (Recording Industry Association of America) recently sued Napster and other programs like it. Although Napster clearly warns users "neither the MP3 file format nor the Napster software indicates whether a particular MP3 file has been authorized for copying or distribution," the RIAA contends that the intention of the program is to serve illegal music pirates.

In addition to the RIAA, individual artists have begun to sue Napster and programs like it for assisting in the illegal distribution of their songs. Recently, heavy metal band Metallica sued Napster and declared: "It is sickening to know that our art is being traded like a commodity rather than the art that it is. From a business standpoint, this is about piracy and that is morally and legally wrong."

Although Metallica may see Napster as a means to trade art "like a commodity," Chuck D believes it is the other way around. He contends that as CD costs reach as high as $15-$17, the record companies turn the art form into an over priced commodity. Napster allows people who would never pay those high prices to become exposed to music. Additionally, Chuck believes that piracy will force record companies to make music cheaper and more accessible to consumers. That, too, will expose more people to music. Otherwise, people will simply continue to steal the music rather than pay the current high prices. Although Chuck does not support breaking the law, he does support Napster's promotion of music as art.

The Future

Obviously, MP3s have caused a rift in the music industry. No one is quite sure what the outcome of all the controversy surrounding MP3s will be. Industry experts have suggested that to lessen costs and make music more accessible, music companies should make all songs available online in an "electronic library" whereby people pay reasonable prices to have access to an entire companies' musical catalog. To combat piracy, some experts suggest that new security measures should be taken to ensure that music isn't stolen. Others believe that copyright laws will have to adapt to the enormity of the Internet, thus developing a system for free distribution of ideas and art.

Most likely, the music industry will have to adapt just as they adapted to MTV. Marketing and distribution schemes may need alteration to comply with this new electronic medium. One thing is for sure: the music industry will never be the same.

For more info, goto www.slashdot.org, www.mp3.com, www.napster.com, or www.riaa.com. To learn about MP3 software, goto www.winamp.com or www.musicmatch.com.